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1. JACKSON HOLDING COMPANY Comparative Income Statement (in part) For the Years Ended
December 31 2021 2020 Income from continuing operations before income taxes $2,215,000
($2,630,000 - $41… view the full answer

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The following condensed income statements of the Jackson Holding Company are presented for
the two years ended December 31, 2021 and 2020: Sales revenue Cost of goods sold Gross profit
Operating expenses Operating income Gain on sale of division 2021 2020 $ 15,300,000 $9,900,000
9,350,000 6,150,000 5,950,000 3,750,000 3,320,000 2,720,000 2,630,000 1,030,000 630,000
3,260,000 1,030,000 815,000 257,500 $ 2,445,000 $ 772,500 Income tax expense Net income On
October 15, 2021, Jackson entered into a tentative agreement to sell the assets of one of its
divisions. The division qualifies as a component of an entity as defined by GAAP. The division was
sold on December 31, 2021, for $5,090,000. Book value of the division's assets was $4,460,000. The
division's contribution to Jackson's operating income before-tax for each year was as follows: 2021
2020 $415,000 $315,000 Assume an income tax rate of 25%. Required: (In each case, net any gain
or loss on sale of division with annual income or loss from the division and show the tax effect on a
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separate line.) 1. Prepare revised income statements according to generally accepted accounting
principles, beginning with income from continuing operations before income taxes. Ignore EPS
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disclosures. 2. Assume that by December 31, 2021, the division had not yet been sold but was
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held for sale. The fair value ofSolutions Expert
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$5,090,000.
Prepare revised income statements according to generally accepted accounting principles,
beginning with income from continuing operations before income taxes. Ignore EPS disclosures. 3.
Assume that by December 31, 2021, the division had not yet been sold but was considered held for
sale. The fair value of the division's assets on December 31 was $3,930,000. Prepare revised income
statements according to generally accepted accounting principles, beginning with income from
continuing operations before income taxes. Ignore EPS disclosures. Complete this question by
entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare revised income
statements according to generally accepted accounting principles, beginning with income from
continuing operations before income taxes. Ignore EPS disclosures. (Amounts to be deducted
should be indicated with a minus sign.) JACKSON HOLDING COMPANY Comparative Income
Statements (in part) For the Years Ended December 31 2021 Income from continuing operations
before income taxes 2020 Income from continuing operations Discontinued operations gain (loss):
ntinued operations_ Income from discontinued operations Net income s 0 $ < Required 1 Required
2 > Required 1 Required 2 Required 3 Assume that by December 31, 2021, the division had not yet
been sold but was considered held for sale. The fair value of the division's assets on December 31
was $5,090,000. Prepare revised income statements according to generally accepted accounting
principles, beginning with income from continuing operations before income taxes. Ignore EPS
disclosures. (Amounts to be deducted should be indicated with a minus sign.) Show less JACKSON
HOLDING COMPANY Comparative Income Statements (in part) For the Years Ended December 31
2021 Income from continuing operations before income taxes 2020 Income from continuing
operations Discontinued operations gain (loss): o Income from discontinued operations Net income
$ l 0 $ 0 < Required 1 Required 3 > Required 1 Required 2 Required 3 Assume that by December 31,
2021, the division had not yet been sold but was considered held for sale. The fair value of the
division's assets on December 31 was $3,930,000. Prepare revised income statements according to
generally accepted accounting principles, beginning with income from continuing operations
before income taxes. Ignore EPS disclosures. (Amounts to be deducted should be indicated with a
minus sign.) Show less JACKSON HOLDING COMPANY Comparative Income Statements (in part)
For the Years Ended December 31 2021 Income from continuing operations before income taxes
2020 Income from continuing operations Discontinued operations gain (loss): Income from
discontinued operations Net income $ 0 $ 0 Required 2 Required 3 >

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