Asked by Samiksha Pathak on Jul 08, 2024
Verified
The gain or loss on the extinguishment of debt is usually categorized on the income statement as part of continuing operations.
Extinguishment Of Debt
The process of fully paying off debt obligations, through payment, refinancing, or restructuring, effectively removing them from the company's balance sheet.
Continuing Operations
The segments of a business expected to continue operating and providing net income for the foreseeable future.
- Identify how gains or losses on the extinguishment of debt are reported in financial statements.
Verified Answer
OL
Osvaldo Lopez EsquivelJul 12, 2024
Final Answer :
True
Explanation :
The gain or loss on the extinguishment of debt is considered an operating activity and is thus classified as part of continuing operations on the income statement.
Learning Objectives
- Identify how gains or losses on the extinguishment of debt are reported in financial statements.