Reference no: EM132895542
Question - On March 31, 2021, Karl General Stores, a public company, decides to discontinue one of their stores. You have the following information about the assets of the store to be closed:
Original cost of assets $1,200,000
Accumulated depreciation taken up to December 31, 2020 666,000
Annual depreciation 111,000
Fair value on March 31, 2021 520,000
Costs to sell the assets 4% of fair value
The store to be closed generated the following results in 2021:
Sales $880,000
Expenses (excluding depreciation on assets held-for-sale in 2021 and losses related to reclassification of assets as held-for-sale) 900,000
Required - Calculate the results from discontinued operations to be presented in Karl General Stores' income statement in 2021. The tax rate is 30%.