Suppose that the Footwear Division's assets had not been sold by December 31, 2013, but were considered held for sale. Assume that the fair value of these assets at December 31 was $80 million. In the 2013 income statement for Foxtrot Co., under discontinued operations it would report a:
A)$6 million loss.
B)$10 million loss.
C)$13.2 million income.
D)None of the above is correct.

Question

Quizplus · Accepted Answer

The loss is calculated as the carrying amount of the assets minus their fair value. If the carrying amount was $86 million and the fair value is $80 million, the loss is $6 million.

Suppose That the Footwear Division's Assets Had Not Been Sold