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Mary opened a Pizza restaurant at 1/1/2020 with her own money in a small town along the Long river. Business was so good for the first quarter. Unfortunately, business began to struggle due to the Covid-19 pandemic and a wildfire. She concluded that she would need additional cash so started a loan application with a local bank. In the application, Mary was puzzled by a question: What is operating income under GAAP for 2020? Mary asked you for help and gave the following information. Cash receipts (1/1/2020 - 12/31/2020) . From customers: $50,000 Cash payments (1/1/2020 - 12/31/2020) Purchase of flour, tomato, and cheese: $30,000 Utilities: $5,000 Salaries: $8,000 Inventory (flour, tomato, and cheese) on hand at 12/31/2020 costs $10,000. The following amount is owed by Mary at 12/31/2020 $5,000 to suppliers of flour, tomato, and cheese The following amount is due to Mary at 12/31/2020 $9.000 from customers Mary recorded a loss of $8,000 due to a wildfire during 2020. (Q) Determine operating income under GAAP for 2020. Loss of $1,000 Income of $13,000 Income of $34,000 The following condense income statements of Oregon Corporation, a diversified company, is presented for the two years ended December 31, 2021 and 2020: Net sales Cost of sales Gross profit Operating expenses Operating income Impairment loss from the disposal of division Net Income before taxes Income tax expenses Net Income 2021 $10,000,000 (6.200,000) 3,800,000 (2.200.000 1,600,000 (900,000) 700,000 (140.000) $560,000 2020 $10,200,000 (6,000,000) 4,200,000 (4.000.000 200,000 200,000 (40,000) 160,000 On September 30, 2021, Oregon entered into an agreement to sell one of its separate operating divisions. The sale was not completed by December 31, 2021. Th division held for sale contributed to Oregon's reported income before taxes for each year as follows: 2021 $500,000 Loss 2020 $100,000 Loss Assume an income tax rate of 20%. (Q) What would be the amount presented for discontinued division (net of tax) for 2020? Loss of $100,000 Indeterminable Loss of $140,000 O Loss of $80,000

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