Manning Company has the following items: write-down of inventories, $360,000; loss on disposal of Sports Division, $555,000; and loss due to strike, $359,000. Ignoring income taxes, what amount should Manning Company report as extraordinary losses?
A) $ -0-.
B) $555,000.
C) $719,000.
D) $914,000.

Question

Quizplus · Accepted Answer

Extraordinary items are no longer classified as such under current accounting standards (FASB Accounting Standards Codification). Therefore, none of the listed items (write-down of inventories, loss on disposal of a division, and loss due to strike) would be considered extraordinary. They would be included in income from continuing operations or as part of discontinued operations if applicable, but not reported as extraordinary losses.

Manning Company Has the Following Items: Write-Down of Inventories, $360,000;