It is now 2X09 and Jump N' Fun is restructuring operations by closing and selling its retail stores in 2X09.All employees that work in these stores will be terminated.
A)The restructuring loss will be included in the income statement in 2X09.
B)The restructuring loss will be included in the income statement in 2X10.
C)Jump N' Fun can take the loss over time so as to manage earnings.
D)The restructuring loss must be reported in the income statement over a five year period.
E)This type of event will have no effect unless there is a gain on the sale of the retail stores.

Question

Quizplus · Accepted Answer

The restructuring loss will be included in the income statement in 2X09 since that is when the decision was made and the stores were closed/sold. The loss cannot be deferred or spread out over time.

It Is Now 2X09 and Jump N' Fun Is Restructuring