The financial results of a discontinued segment must be reported separately on the income statement.

Question

Quizplus · Accepted Answer

According to Generally Accepted Accounting Principles (GAAP), the financial results of a discontinued segment must be reported separately on the income statement. This allows investors and analysts to accurately assess the ongoing performance of the company by removing the effects of the discontinued segment. This requirement is outlined in Accounting Standards Codification (ASC) 205-20, Presentation of Financial Statements, Discontinued Operations.

The Financial Results of a Discontinued Segment Must Be Reported