Vane's income tax rate is 30%. In Vane's 20X3 multiple-step income statement, what amount should Vane report as income after income taxes from continuing operations

The correct option is A. $126,000.

Explanation:

Note: This question is not complete. The complete question is therefore provided before answering the question. See the attached pdf file for the complete question.

The explanation to the answer now provided as follows:

A multi-step income statement can be described as an income statement that provides gross profit and each category of expenses and incomes in details to determine the net income of a business for a specified period.

The to determine the amount should Vane report as income after income taxes from continuing operations, we prepared its year-end multiple-step income statement as follows:

Vane Co.

Year-end multiple-step income statement

Particulars                                      $                         $          

Sales                                                                     575,000

Cost of sales                                                       (240,000)  

Gross income                                                       335,000

Administrative expenses                                      (70,000)

Selling and distribution exp.:

Sales commissions                    (50,000)

Freight out                                  (15,000)            (65,000)  

Operating income                                              200,000

Interest income:

Interest revenue                                                   25,000

Other expenses:

Uncollectible accounts expense                         (15,000)

Other income (loss):

Loss on sale of equipment                                   (10,000)

Loss on early retirement of LT debt                    (20,000)  

Income before tax                                                 180,000

Tax ($180,000 * 30%)                                           (54,000)

Income after tax                                                   126,000

Therefore, Vane should report $126,000 as income after income taxes from continuing operations. That is, the correct option is A. $126,000.

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