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The division's book value and fair value less cost to sell on December 31 were $3,000,000 and $3,500,000, respectively. What before-tax amount(s) should the company report as loss on discontinued operations in its 2021 income statement?
a. $2,000,000 loss.
b. $2,500,000 loss.
c. No loss would be reported.
d. $500,000 impairment loss included in continuing operations and a $2,000,000 loss from discontinued operations.

Respuesta :

chamberlainuket

Answer:

A $2,000,000 loss

Explanation:

See attached file

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abiolataiwo2015

Answer:

$2,000,000 loss from operations only. There is no impairment loss.

Explanation:

Since the division’s book value and fair value less cost to sell on December 31 were $3,000,000 and $3,500,000, respectively.

The before-tax amount(s) Mercedes would report is $2,000,000 loss on discontinued operations since there is no impairment loss.

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