For-Profit Financial Statements

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Question

When does a disposal qualify as discontinued operations under ASC 205-20?

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Answer

Only when it is a strategic shift with a major effect.

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Question

Why are discontinued operations reported below income from continuing operations?

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Answer

They are separately identified, net of tax.

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Question

How should accumulated depreciation affect PP&E on the balance sheet?

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Answer

Net it against PP&E as a contra account.

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Question

How is consolidated net income allocated when a subsidiary is less than wholly owned?

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Answer

Between the parent and noncontrolling interest by ownership percentage.

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