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Determine income from discontinued operations

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Question - A Company's segment A was approved on September 1, 2020 by its BOD to be for disposal. Sale is expected to be completed by September 1, 2021.

Results of transactions during the year for segment A are as follows:

Revenue (January to August) - P7,000,000

Revenue (Sept to December) - P5,400,000

Operating expenses (January to August) - P3,000,000

Operating expenses (Sept to December) - P2,000,000

The carrying amount of segment A's net assets on December 31, 2020 was P11,000,000 while its value in use was P12,000,000.

A Company is required by contract to pay its employees for P800,000.

Using an income tax rate of 30%, determine income from discontinued operations for 2020.

Reference no: EM132916491

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