Income From Continuing Operations Loss From Discontinued Operations

The following is a historical example from the dot com era to demonstrate how continuing operations and discontinued operations might arise on the income statement.

Income from continuing operations loss from discontinued operations. Viacom and simon schuster in the 1990s viacom owner of mtv vh1 and nickelodeon purchased paramount studios. Income or loss from discontinued operations is a line item on an income statement of a company below income from continuing operations and before net income. The lines in this section may include gain or loss from discontinued operations including disposal income tax benefit or expense and the tax adjusted gain or loss from discontinued operations. Continuing operations refer to all business operations excluding the segments that are discontinued.

If an entity ceases to classify a component of an entity as held for sale the results of operations of the component previously presented in discontinued operations are reclassified and included in income from continuing operations for all periods presented ifrs 5 36. And discontinued operations from. As you recall gaap requires separate reporting below income from continuing operations which allows our reader such as the investors and creditors to make much better decisions and also do a better. The income from the continuing operations is reported in a multi step income statement of the business that accounts for the regular business activities.

Income taxes 5 250 000 income from continuing operations. These operations generate revenue for the business through the sale of goods and services. As a discontinued operation reported below income from continuing operations. Discontinued operations are listed separately on the income statement because it s important that investors can clearly distinguish the profits and cash flows from continuing operations from those.

It represents the after tax gain or loss on sale of a segment of business and the after tax effect of the operations of the discontinued segment for the period. This should come after the continuing operations section meaning below the net income from continuing operations line. Income from continuing operations before income taxes.