When a business segment is discontinued during the year,the gain or loss on disposal
A) is reported as an extraordinary item.
B) should include only the loss or income from operating the discontinued segment for the current period.
C) excludes only the gain or loss on disposal of the segment.
D) should be shown net of applicable income taxes.

Question

Quizplus · Accepted Answer

When a business segment is discontinued during the year, the gain or loss on disposal should be shown net of applicable income taxes, meaning taxes should be taken into consideration. Options A, B, and C are incorrect because the gain or loss from discontinued operations is reported as a separate component of income from continuing operations and not as an extraordinary item, and it should include both the income or loss from operating the discontinued segment and the gain or loss on disposal.

When a Business Segment Is Discontinued During the Year,the Gain