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Patterson has pre-tax profit from all operations in 2015 of $38 million. This amount includes a...

Patterson has pre-tax profit from all operations in 2015 of $38 million. This amount includes a $9 million operating loss from the toy car division incurred between the beginning of the year and August 15, the disposal date of the division. The $38 million profit does not include a pre-tax gain on the sale of the toy car division of $6 million. Prepare a partial statement of net income for Patterson for 2015, beginning with income from continuing operations before tax.

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Answer #1

Statement of Income for the year ended 2015:

Particulars Amount in million
Income from continuing operations before tax($38+$9) $47
Income From Operations of Discontinued Segment (Net of Taxes)* ($9)
Extraordinary Gain(gain on sake of toy car devision) $6
Net Income $44

Net Income of Patterson is $44 million for the year ending, 2015

*Income from discontionued operation shouild be reported net of taxes as tax rate is not mentioned, gross amount is mentioned

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