Card Set Information
CPA Review Financial Reporting
Discontinued Operations and Exit or Disposal Activities
Describe discontinued operations?
The (normally) loss from discontinued operations can consist of an impairment loss, gain/loss from actual operations and a gain/loss on disposal - Not before
A business is held for sale in the period in which what criteria are met?
1. Management commits to a plan to sell the component
2. Component is available for immediate sale in its present condition
3. Active program to locate a buyer has been initiated
4. Sale of the component is probable and sale is expected to be complete within one year
5. Sale of the component is being actively marketed
6. Actions required to complete the sale make it unlikely that significant changes to the plan will be made or that the plan will be withdrawn
Types of entities considered for discontinued operations
1. has been disposed of or,
2. is classified as held for sale