Discontinued Operations

AAA

DEFINITION of 'Discontinued Operations'

A segment of a company's business that has been sold, disposed of or abandoned. Discontinued operations can range from a certain product line to an entire line of business. When operations are discontinued, this is reported on the company's income statement as separate from income from continued operations.

INVESTOPEDIA EXPLAINS 'Discontinued Operations'

Because income from discontinued operations is listed separately on the income statement, investors are less likely to be misled as to the source of a company's profit. This is especially useful when companies merge, since parsing out which assets are being divested or folded up gives a clearer picture of how a company will make money in the future.

RELATED TERMS
  1. Process Value Analysis - PVA

    A strategy that businesses use to determine whether all of their ...
  2. Distress Price

    When a firm chooses to mark down the price of an item or service ...
  3. Non-Core Assets

    Assets that are either not essential or simply no longer used ...
  4. Continuing Operations

    Continuing operations is a business term used to describe the ...
  5. Income From Operations - IFO

    The profit realized from a business' own operations. Income from ...
  6. Operating Income

    The amount of profit realized from a business's operations after ...
Related Articles
  1. Zooming In On Net Operating Income
    Investing

    Zooming In On Net Operating Income

  2. Find Investment Quality In The Income ...
    Options & Futures

    Find Investment Quality In The Income ...

  3. Understanding The Income Statement
    Forex Education

    Understanding The Income Statement

  4. What Is A Cash Flow Statement?
    Markets

    What Is A Cash Flow Statement?

comments powered by Disqus
Hot Definitions
  1. Elasticity

    A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which ...
  2. Tangible Common Equity - TCE

    A measure of a company's capital, which is used to evaluate a financial institution's ability to deal with potential losses. ...
  3. Yield To Maturity (YTM)

    The rate of return anticipated on a bond if held until the maturity date. YTM is considered a long-term bond yield expressed ...
  4. Net Present Value Of Growth Opportunities - NPVGO

    A calculation of the net present value of all future cash flows involved with an additional acquisition, or potential acquisition. ...
  5. Gresham's Law

    A monetary principle stating that "bad money drives out good." In currency valuation, Gresham's Law states that if a new ...
  6. Limit-On-Open Order - LOO

    A type of limit order to buy or sell shares at the market open if the market price meets the limit condition. This type of ...
Trading Center