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The following amounts were taken from the financial statements
of Plant Company:
2013 2012
Total assets $800,000 $1,000,000
Net sales 720,000 650,000
Gross profit 352,000 320,000
Net income 126,000 117,000
Weighted average number of common shares outstanding 90,000
90,000
Market price of common stock $35 $39
The return on assets ratio for 2013 is14%
32%.
28%.
16%.
7-
Multiple Choice Question 174
Parrish, Inc. decided on January 1 to discontinue its telescope
manufacturing division. On July 1, the division’s assets with a
book value of $1,250,000 are sold for $850,000. Operating income
from January 1 to June 30 for the division amounted to $125,000.
Ignoring income taxes, what total amount should be reported on
Parrish’s income statement for the current year under the
caption, Discontinued Operations?
$400,000 loss
$275,000 loss