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Income from Discontinued Operations |
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WIKI ANALYSIS| This article is part of WikiProject Definitions. Consider editing to improve it. View articles referencing this definition. |
Income from discontinued operations is income a company earned from parts of its business which it has sold off or no longer operates.
Income from discontinued operations is called out separately in a company's Income Statement so that investors understand that, although the company earned that income in that last year or quarter, they shouldn't expect those earnings to be around in the future as that division no longer exists.
Income from discontinued operations also includes the proceeds of the sale of any businesses.
Example
If a company has a division that makes widget XYZ, and that division earned $5 million in net income in 2008 before the company sold the division for $100 million to a competitor, the company would report $105 million in income from discontinued operations on its income statement.
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