4 The Income Statement and Income Recognition.pptVIP

Income statement section consists of two parts: Income (loss) from operations--disclosed only if decision to discontinue operations is made after beginning of the year. Gain (loss) on disposal of operations-- consisting of income (loss) during phase- out and gain (loss) from disposal of segment assets. Special rules when disposal date is in year following measurement date. A realized “loss on disposal” may be increased by an estimated loss or it may be reduced by an estimated gain. A realized “gain on disposal” may be reduced by an estimated loss but cannot be increased by an estimated gain