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6 Cards in this Set
- Front
- Back
Definition
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results of operations of a component of an enterprise that has been deposed of or is classified as held for sale. 2 conditions:
-operations and cash flows of component have been (or will be) eliminated from the ongoing operations of enterprise as a result of disposal transaction and -enterprise will not have any significant continuing involvement in operations after |
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Component
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operations and cash flows can be clearly distinguished operationally and for financial reporting purposes from the rest of the enterprise
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Recognition Criteria
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-mgmt commits to plan to sell
-assets/liabilities are available for immediate sale -sale is probable and is expected to be completed w/in 1 year -selling price is reasonable in relation to current fair value |
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Measurement
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LT (capital) assets should be measured at lower of carrying value (NBV) and fair value less cost to sell (NRV).
-assets held for sale should not be amortized -further expected gains or losses should NOT be accrued |
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Presentation
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I/S: results of disc. ops (net of income taxes) should be reported as a separate element of income or loss before extraordinary items for both CURRENT AND PRIOR periods
*intra-period tax allocation B/S: assets and liabilities of disc. ops held for sale should be presented separately in asset and liability sections |
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Disclosure
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-description of facts and circumstances leading to disposal
-expected manner of disposal -any amt of write-down of LT assets -amt of revenue and pre-tax profit of disc. op. |