AICPA Exam CPA-Financial Topic 2 Question 98 Discussion

Actual exam question for AICPA's CPA-Financial exam

Question #: 98
Topic #: 2

[All CPA-Financial Questions]

A segment of Ace Inc. was discontinued during 1992. Ace's loss from discontinued operations should not:

AInclude employee relocation costs associated with the decision to dispose.

BExclude operating losses from the date the decision to dispose of the segment was made until the end of 1992.

CInclude additional pension costs associated with the decision to dispose.

DInclude operating losses of the current period up to the date the decision to dispose of the segment was made.

Show Suggested Answer

Suggested Answer: B

Choice 'b' is correct. $120,000 expense included in the determination of net income or loss for the sixmonth interim period ended June 30, 1991.

by Louis at Sep 16, 2024, 04:42 PM

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Lisbeth

5 days ago

I think the answer is B. The operating losses from the date the decision to dispose of the segment was made until the end of 1992 should be excluded, not included.

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Chan

9 days ago

I disagree. I think the loss should include all operating losses up to the date of disposal.

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Giuseppe

10 days ago

I agree with Sherill. It should also exclude operating losses after the decision to dispose.

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Sherill

11 days ago

I think the loss should not include employee relocation costs.

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