Regarding discontinued operations,which of the following statements is incorrect?
A) Gains and losses on the sale of plant assets and equipment are reported as Other Income and (Expenses).
B) A loss on discontinued operations is reported with an addition for the applicable income tax.
C) The sale of an identifiable division of the business is reported on the income statement under the category Discontinued Operations.
D) The Discontinued Operations category of the income statement includes information about segments of the business that have been sold.

Question

Quizplus · Accepted Answer

A loss on discontinued operations is not reported with an addition for the applicable income tax. Instead, the income tax expense or benefit related to the discontinued operations is reported separately as a component of income tax expense/benefit on the income statement. The other statements are correct.

Regarding Discontinued Operations,which of the Following Statements Is Incorrect