Joe loser enters into an investment scheme with some local bigwigs. to get joe's money, these people lie to joe about several present facts that are critical to the investment scheme. later, joe sues to rescind the investment contract on the basis of fraud. while joe is on the stand, the attorney for the other parties asks him: "mr. loser, why did you enter this deal in the first place? " joe says: "for one reason and one reason only: i admired these men tremendously and figured that any deal good enough for them was a deal i wanted in on too. the details didn't matter; if they were in it, i wanted to be in it too." joe has just blown his fraud case. why?

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.