Lupton Inc

Multiple Choice

Lupton Inc. disposes of an unprofitable segment of its business. The operation of the segment suffered a $160,000 loss in the year of disposal. The loss on disposal of the segment was $80,000. If the tax rate is 30%, and income before income taxes was $1,300,000,

A) the income tax expense on the income before discontinued operations is $318,000.
B) the income from continuing operations is $910,000.
C) net income is $1,060,000.
D) the losses from discontinued operations are reported net of income taxes at $240,000.