On October 1, 2016, Croatan Corporation Finalized Its Plans to Discontinue

Essay

On October 1, 2016, Croatan Corporation finalized its plans to discontinue operations of its retail component. The plan calls for the sale of the retail operations to another company for $700,000 current fair value) on April l, 2017. The current book value of the assets is $800,000. For the first nine months of 2016, the component incurred a pretax operating income of $60,000. During the last quarter of 2016, the pretax income was $10,000, while the expected pretax income for the first quarter in 2017 is expected to be $20,000. Croatan is subject to a 30% income tax rate.
Required:
Prepare the results from discontinued operations section of Croatan's income statement for 2016, using good format. Show all computations.