The income statement of Rawl Company for the year ended December 31, 2010, shows the following:
Net sales............................................................... $ 360,000
Cost of sales ........................................................... 190,000
Gross profit ............................................................ 170,000
Selling, general, and administrative expense ...................... 80,000
Income before unusual write-offs ................................... 90,000
Provision for unusual write-offs ..................................... 50,000
Earnings from operations before income taxes .................... 40,000
Income taxes ........................................................... 20,000
Net earnings from operations before extraordinary charge ...... 20,000
Extraordinary charge, net of tax of $10,000 ....................... (50,000)
Net earnings (loss) ..................................................... $ (30,000)
Required
Compute the net earnings remaining after removing unusual write-offs and the extraordinary charge. Remove these items net of tax. Estimate the tax rate for unusual write-offs based on the taxes on operating income.