A Discontinued Operation Must Be a Business Segment or Unit

question 14

True/False

A discontinued operation must be a business segment or unit that is a portion of an entity with operations and cash flows.

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Definitions:

Net Income

The end profit for a business after total revenue is reduced by expenses and tax obligations.

Perpetual Inventory System

An approach to inventory management where inventory levels are updated in real-time following each sale or purchase.

Sales Return

Goods returned by the customer to the seller after the sale, leading to a reversal of revenue recorded.

Collection

Collection involves the process of gathering or receiving payments, funds, or necessary documents, especially in the context of business receivables or debts.