In example 1, may I know why there is no adjustment for the cost attributable to the closure $5000 (admin expenses) and the gain of $7000? Surely the gain is offsetting and this is not supposed to be done?
There is no lecture for this and I have read the answer from the notes which just gives you the numbers.
Both the $5,000 costs and the $7,000 gain are netted off against administrative expenses and accounted for within the pre-discontinuance figure of $70,000 and the administrative expenses specifically related to the discontinuance of $10,000