Danio's Diagnostics had a loss from discontinued operations of $130,000. If their corporate tax rate is 40%, at what amount will the loss be shown on the Income Statement?
A)$130,000
B)$78,000
C)$52,000
D)Not enough information is given to answer the question.

Question

Quizplus · Accepted Answer

The loss from discontinued operations of $130,000 will be multiplied by the corporate tax rate of 40%, resulting in a tax benefit of $52,000. Therefore, the loss will only be shown on the Income Statement at a net amount of $78,000 ($130,000 - $52,000).

Danio's Diagnostics Had a Loss from Discontinued Operations of $130,000