Practice Quiz

CPA Accountant Review Questions

Category - Accounting

Start a Study Session Sign up for Question of the Day
Jim’s Jeans decided to shut down their Jimmy Jean Division. Where on the income statement would this closing be addressed?
  1. Under extraordinary items at the bottom of the income statement.
  2. As a note on the operating income section of the income statement.
  3. Under discontinued operations at the bottom of the income statement.
  4. As a deduction in the Net Profit section of the income statement.
  5. An entry would be on the operating income section of the income statement.
Explanation
Answer - C - The closing of the division would be listed under discontinued operations at the bottom of the Income Statement.

Key Takeaway: Both extraordinary items and discontinued operations are separated out in the income statement and added to a separate, last section of the statement. They are listed and kept separate, with discontinued operations first and extraordinary items coming second.
Previous Next
Was this helpful? Upvote!
Login to contribute your own answer or details
Start a Study Session Sign up for Question of the Day

Top questions

Related questions

Most popular on PracticeQuiz