Questions: The following items appeared in the year-end trial balance for Coffee Bean Company: Debits Credits Revenues 600,000 Operating expenses 420,000 Income on discontinued operations 100,000 200,000 Restructuring costs 20,000 Interest expense 30,000 Income tax expense has not yet been accrued. The company's income tax rate is 25%. What amount should be reported in the company's income statement as income from continuing operations after taxes?

To determine the income from continuing operations after taxes for Coffee Bean Company, we need to follow these steps:

1. Calculate Income from Continuing Operations Before Taxes:

   • Revenues: $600,000
   • Operating Expenses: $420,000
   • Restructuring Costs: $20,000
   • Interest Expense: $30,000

   Income from continuing operations before taxes is calculated as follows: \[ \text{Income from Continuing Operations Before Taxes} = \text{Revenues} - \text{Operating Expenses} - \text{Restructuring Costs} - \text{Interest Expense} \] \[ = \$600,000 - \$420,000 - \$20,000 - \$30,000 = \$130,000 \]

2. Calculate Income Tax on Continuing Operations:

   • The income tax rate is 25%.
   • Income tax on continuing operations is calculated as: \[ \text{Income Tax} = \text{Income from Continuing Operations Before Taxes} \times \text{Tax Rate} \] \[ = \$130,000 \times 0.25 = \$32,500 \]

3. Calculate Income from Continuing Operations After Taxes:

   • Subtract the income tax from the income from continuing operations before taxes: \[ \text{Income from Continuing Operations After Taxes} = \text{Income from Continuing Operations Before Taxes} - \text{Income Tax} \] \[ = \$130,000 - \$32,500 = \$97,500 \]

Therefore, the amount that should be reported in the company's income statement as income from continuing operations after taxes is $97,500.