Bruce moneybags owns several restaurants and hotels near a local interstate. one restaurant, beef and more, originally cost $1.8 million, is currently fully paid for, but needs modernized. bruce is trying to decide whether to accept an offer and sell beef and more, as is, for the offer price of $1.1 million or renovate the restaurant himself. the projected renovation cost is $1.3 million. the restaurant would need to be shut down completely during the renovation which would cause an aftertax net loss of $90,000 in today's dollars. the estimated present value of the cash inflows from the renovated restaurant is $3.2 million. when analyzing the renovation project, what cost, if any, should be included for the current restaurant?

Kandon enterprises, inc., has two operating divisions; one manufactures machinery and the other breeds and sells horses. both divisions are considered separate components as defined by generally accepted accounting principles. the horse division has been unprofitable, and on november 15, 2018, kandon adopted a formal plan to sell the division. the sale was completed on april 30, 2019. at december 31, 2018, the component was considered held for sale. on december 31, 2018, the company’s fiscal year-end, the book value of the assets of the horse division was $415,000. on that date, the fair value of the assets, less costs to sell, was $350,000. the before-tax loss from operations of the division for the year was $290,000. the company’s effective tax rate is 40%. the after-tax income from continuing operations for 2018 was $550,000. required: 1. prepare a partial income statement for 2018 beginning with income from continuing operations. ignore eps disclosures. 2. prepare a partial income statement for 2018 beginning with income from continuing operations. assuming that the estimated net fair value of the horse division’s assets was $700,000, instead of $350,000. ignore eps disclosures.