What amount should be reported as income or loss

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Reference no: EM132826322

Question - Jazz Company operates two restaurants, one in Boracay and one in Dakak. During 2017, the entity decided to close the restaurant in Dakak and sell the property. It is probable that the disposal will be completed early next year.

The revenue and expenses for 2017 and for the preceding two years are as follows:

	2017	2016	2015
Sales-Boracay	60,000	48,000	40,000
Cost of goods sold-Boracay	26,000	22,000	18,000
Other expenses-Boracay	14,000	13,000	12,000
Sales-Dakak	23,000	30,000	52,000
Cost of goods sold-Dakak	14,000	19,000	20,000
Other expenses-Dakak	17,000	16,000	15,000

During the later part of 2017, the entity sold much of the kitchen equipment of the Dakak equipment of the Dakak restaurant and recognized a pretax gain of P15,000 on the disposal. The income tax rate is 30%.

Required - What amount should be reported as income or loss from discontinued operation for 2017?

a. 8,000 loss

b. 7,000 income

c. 5,600 loss

d. 4,900 income

Reference no: EM132826322

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