The semiconductor business of the California Microtech Corporation qualifies as

Question

The semiconductor business of the California Microtech Corporation qualifies as a component of the entity according to G M P . The book value of the assets of the segment was $17 million. The loss from operations of the segment during 2016 was $4.8 million. Pretax income from continuing operations for the year totaled $6.8 million. The income tax rate is 35%. Assume that the semiconductor segment was not sold during 2016 but was held for sale at year-end. The estimated fair value of the segment's assets, le s s costs to sell, on December 31 was $19 million. Prepare the lower portion of the 2016 income statement beginning with pretax income from continuing operations. Ignore EPS disclosures. (Amounts to be deducted and negative amounts should be indicated with a minus sign. Enter your answers in whole dollars.)

Explanation / Answer

California Microtech Corporation Partial Income Statement For The Year Ended December 31, 2016 $ Income from Continuing Operations before Income Taxes 6800000 Tax Impact @ 35% thereon -2380000 Retained Earnings from Continuing Operations 4420000 Discontinued Operations -4800000 Gain Receivable on Sale of Business 2000000 Loss from Discontinued Operations Carried Fwd -2800000 Net Earnings for the year 1620000

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