Question

in 250 words of more, describe discontinued operations and why it does or does matter

Answer 1

In accounting, discontinued operations refers to the results of operations of a component of an entity that is either has already been disposed of or held for sale currently. The designated results of operations need to be reported as a discontinued operation within the financial statements if both of the said conditions are met.

-- Resulting elimination: The disposal transaction will reflect it's effect in the cash flows and operations of the component being eliminated from company operations.

-- Continuing involvement: Once the disposal transaction has been completed, there will be no significant continuing involvement in the operations of the component by the company.