When a Company Sells a Segment of Its Business,the Gain

question 92

Multiple Choice

When a company sells a segment of its business,the gain or loss on the disposal is shown as:

• A) an extraordinary item
• B) part of discontinued operations
• C) part of income from continuing operations
• D) a prior-period adjustment

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Definitions:

Statement Of Income

A financial statement that shows a company's revenues, expenses, and net profit or loss over a specific period.

Intangible Asset

An asset that is not physical in nature, such as patents, trademarks, and goodwill, which has value due to its potential to generate economic benefits.

Identifiable

Capable of being recognized and distinguished from others, often used in accounting and finance to describe assets that can be attributed to a particular entity.

Cash Flows

The inflows and outflows of cash and cash equivalents, representing the operating, investing, and financing activities of a business.