When a Company Discontinues a Segment of Its Business, the Income

question 68

True/False

When a company discontinues a segment of its business, the income statement should report income (loss)from continuing operations and income (loss)from discontinued operations.

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Definitions:

In-process Research and Development

The value of research and development efforts acquired through an acquisition that have not yet reached commercial viability.

Business Combination

A transaction or event in which an acquirer obtains control of one or more businesses.

Acquisition

Acquiring management of a different company through the acquisition of its stocks or possessions.

Accounting

The systematic process of recording, analyzing, summarizing, and reporting the financial transactions of a business or individual.