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What amount will be reported for discontinued operations

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Question - Cinnamon Inc. (CI) is selling the net assets of its packaging division. The packaging division qualifies as a discontinued operation in accordance with IFRS 5 Non-current Assets Held for Sale and Discontinued Operations. Pertinent information for the most recent fiscal year end is as follows:

-Income up to the date that CI's Board of Directors voted on disposal of the division: $3,000,000

-Income between the date of the board's decision and the fiscal year end: $500,000

-Carrying value of net assets of the division: $600,000

-Fair value of net assets of the division: $500,000

-Sales commission to be incurred related to the disposal: 5% of proceeds

-Estimated income from the division during the three months between the fiscal year end and when the disposition is expected to take place: $200,000

Assuming CI's effective tax rate is 40%, what amount will be reported for discontinued operations in the statement of comprehensive income for the recent fiscal year end?

Reference no: EM132939858

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