A flood destroyed the home office building of a company located in an inland city. This should be reported as a(n)
A) extraordinary loss.
B) prior period adjustment.
C) loss from continuing operations.
D) loss from discontinued operations.

Question

Quizplus · Accepted Answer

A flood resulting in the destruction of a company's home office building is an extraordinary event that is not expected to recur in the normal course of business. Therefore, it should be reported as an extraordinary loss in the income statement.

A Flood Destroyed the Home Office Building of a Company