Which of the Following Statements Regarding Discontinued Operations Is True

question 6

Multiple Choice

Which of the following statements regarding discontinued operations is true?

• A)The assets and liabilities of a disposal group classified as held for sale by an entity may be offset and shown as a single item on the balance sheet of the entity.
• B)The assets and liabilities of a disposal group of an entity must be shown separately in the asset and liabilities sections of the balance sheet of the entity and cannot be offset.
• C)An adjustment in a subsequent period to the selling price of a component of an entity sold must be reported as a retroactive adjustment in the prior-period financial statements of the entity in which the discontinued operation was reported.
• D)The gain or loss on disposal of a component of an entity classified as a discontinued operation need not be disclosed separately from the loss from operations of the discontinued segment.
• E)None of these answers is correct.

---

Definitions:

Achievement Drive

An individual's innate push to set and accomplish challenging goals and persist in the face of obstacles.

Hierarchy and Routine

A structured order and established processes within an organization to ensure efficiency and predictability.

Interpersonal Skills

Abilities used by individuals to interact effectively and harmoniously with other people.

Transformational Style

A leadership approach focused on inspiring and motivating followers to exceed their own interests for the good of the group or organization by effecting significant change.