Ivanhoe Manufacturing Company has income from continuing operations of $585,000 (after tax) for the year ended December 31, 2025. It also has the following items (before considering income taxes): (1) An unrealized loss of $113,000 available-for-sale debt securities. (2) A gain of $56,500 on the discontinuance of a major component of the business. (3) A cumulative effect of a change in accounting principle that resulted in an increase in prior years' depreciation of $47,000.

Ivanhoe Manufacturing Company has income from continuing operations of $585,000 (after tax) for the year ended December 31, 2025. It also has the following items (before considering income taxes): (1) An unrealized loss of $113,000 available-for-sale debt securities. (2) A gain of $56,500 on the discontinuance of a major component of the business. (3) A cumulative effect of a change in accounting principle that resulted in an increase in prior years' depreciation of $47,000.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter18: Accounting For Income Taxes

Section: Chapter Questions

Problem 9MC: Brooks Company reported a prior period adjustment of 512,000 in pretax financial "income" and...

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