Nonrecurring Gain Or Loss

DEFINITION of 'Nonrecurring Gain Or Loss'

A one-time or highly infrequent profit or loss. One-time gains or losses are reported separately in a coporation's income statement - net of income taxes - and are not shown to affect earnings per share (EPS).

Also referred to as "extraordinary charges" for accounting purposes.

BREAKING DOWN 'Nonrecurring Gain Or Loss'

Capital gains from the sale of land or casualty losses are items that are often seen as nonrecurring gains and losses. Write-offs or write-downs relating to normal business expenses (i.e. inventory) are not be considered nonrecurring losses unless they are due to one-time events, such as a natural disaster.

Investors need to carefully examine a company's financial statements to see what types of nonrecurring gains and/or losses a holding posts and how frequently they engage in these types of transactions. While by their very nature nonrecurring gains and losses are meant to occur very infrequently, the reality is that companies often report these types of expenses.

RELATED TERMS
  1. Nonrecurring Charge

    An entry that appears on a company's financial statements for ...
  2. One-Time Item

    An accounting item in a company's income statement that is non-recurring ...
  3. Earnings Before Interest, Taxes, ...

    A measure of a company's financial performance that looks at ...
  4. Extraordinary Item

    Gains or losses included in a company's financial statements, ...
  5. One-Time Charge

    A charge against earnings that is expected to be an isolated ...
  6. All-Inclusive Income Concept

    A method of income reporting that includes the total non-owner ...
Related Articles
  1. Investing

    Financial Statement: Extraordinary Vs. Nonrecurring Items

    When it comes to analyzing a company, successful analysts spend considerable time differentiating between accounting items that are likely to recur going forward from those that most likely will ...
  2. Investing

    Detecting Accounting Manipulation

    "One-time charges" and "investment gains" are two strategies companies can use to distort their numbers.
  3. Investing

    The One-Time Expense Warning

    These income statement red flags may not spell a company's downfall. Learn why here.
  4. Managing Wealth

    Capital Losses and Tax

    Capital losses are never fun to incur, but they can reduce your taxable income. Knowing the rules for capital losses can help you maximize your deductions and make better choices about when to ...
  5. Financial Advisor

    Top Tips for Deducting Stock Losses

    Investors who know the rules can turn their losing picks into tax savings. Here's how to deduct your stock losses.
  6. Personal Finance

    Here's How to Deduct Your Stock Losses From Your Tax Bill

    Learn the proper procedure for deducting stock investing losses, and get some tips on how to strategically take losses to lower your income tax bill.
  7. Personal Finance

    Capital Losses and Tax

    When an investment sells for less than its purchase price, the difference is a capital loss.
  8. Financial Advisor

    Here's the Best Way to Skirt Capital Gains Taxes

    Taxpayers who know the rules for netting gains/losses can generate additional losses to net against the taxable gains in their portfolios. Here's how.
  9. Investing

    Understanding the Income Statement

    The best way to analyze a company—and figure out if it's worth investing in—is to know how to dissect its income statement. Here's how to do it.
  10. Personal Finance

    Deducting Disaster: Casualty And Theft Losses

    If you've been a victim, your losses may be deductible. Find out how.
RELATED FAQS
  1. What is the difference between recurring and non-recurring general and administrative ...

    Understand the expenses involved in a company's general and administrative operating costs and the difference between recurring ... Read Answer >>
  2. How are capital gains calculated when using an online brokerage account?

    Are capital gains calculated annually or on every trade? How can selling a stock at a loss save me money on taxes? Also, ... Read Answer >>
  3. What is the accounting treatment for unusual or infrequent items for IFRS and U.S. ...

    Learn to identify the unusual or infrequent items listed on an income statement prepared according to either US GAAP or IFRS ... Read Answer >>
  4. What are the differences between gains & losses and revenue & expenses?

    Learn how to distinguish between gains, losses, revenues and expenses. Take a look at how accountants record each category ... Read Answer >>
  5. What are the key differences between pro forma statements and GAAP statements?

    Learn the key differences between pro forma and GAAP statements. Review examples and cautionary notes about reliance on pro ... Read Answer >>
  6. How are the three major financial statements related to each other?

    Learn why investors analyze a company's financial statements, and how the income statement, balance sheet and cash flow statement ... Read Answer >>
Hot Definitions
  1. Cyclical Stock

    An equity security whose price is affected by ups and downs in the overall economy. Cyclical stocks typically relate to companies ...
  2. Front Running

    The unethical practice of a broker trading an equity based on information from the analyst department before his or her clients ...
  3. After-Hours Trading - AHT

    Trading after regular trading hours on the major exchanges. The increasing popularity of electronic communication networks ...
  4. Omnibus Account

    An account between two futures merchants (brokers). It involves the transaction of individual accounts which are combined ...
  5. Weighted Average Life - WAL

    The average number of years for which each dollar of unpaid principal on a loan or mortgage remains outstanding. Once calculated, ...
  6. Real Rate Of Return

    The annual percentage return realized on an investment, which is adjusted for changes in prices due to inflation or other ...
Trading Center