Which of the following statements is INCORRECT?
A)The balance sheet caption "Discontinued Operations" includes both operating income or loss of the segment during the divestiture period and gains or losses on the transaction at the point of sale of the segment.
B)Income from discontinued operations is a component of net income.
C)All gains and losses from discontinued operations are shown "net of tax."
D)Financial analysts typically do not include discontinued operations in predictions of future corporate income because the discontinued segments will not continue to generate income for the business.

Question

Quizplus · Accepted Answer

The balance sheet does not include "Discontinued Operations"; this is a component of the income statement. Discontinued operations include operating income or loss and gains or losses on the sale, but they are reported in the income statement, not the balance sheet.

Which of the Following Statements Is INCORRECT