Presented below are the condensed income statement of Vital Corporation for the years ended December 31, 2020 and 2019: 2020 2019 Sales 5,000,000 900,000 Cost of goods sold 350,000 300,000 Gross income 650,000 600,000 Operating expenses Operating income 975,000 950,000 Gain on sale of division Net income before income tax 175,000 950,000 Income tax expense (35%) 411,250 332,500 Net income 763,750 617,500
On October 10, 2020, Chalangs entered into an agreement to sell the assets of one of its geographical segments The geographical segment comprises operations and cash flows that can be clearly distinguished, operationally and for financial reporting purposes from the rest of the company The segment was sold on December 31, 2020, for P1,750,000. The book value of the segment's assets was P1,550,000. The segment's contribution to Chalangs' operating income before tax for each year was as follows: 2020 13,750 loss 2019 81,250 income Assume that by December 31, 2020, the segment had not yet been sold but was considered held for sale. The fair value of the segments assets on December 31 was P1,250,000 The post-tax loss from discontinued operations for 2020, based on the above data should be: