Discontinued Operations and Extraordinary Items

Companies elect to discontinue lines of business for a variety of reasons, including issues related to cash flow and profitability. This is a major decision because of how much time, effort, and, of course, money the company has already invested in these lines of business. When do you think it is appropriate to discontinue an operation? When is it appropriate to declare an extraordinary item?With these thoughts in mind:Write at least 200 words answering the following questions:What factors do you think a company should consider before discontinuing a line of business?Researching the notes to the financial statements for your chosen companies (See below), did you note any discontinued operations or extraordinary items occurring during the period 2006–2009? Do you agree with the reasons why a line of business might have been discontinued? If there were no discontinued operations or extraordinary items, do you think a line of business should have been discontinued? Justify your position.Do you think the FASB disclosure requirements for discontinued operations or extraordinary items are reasonable? Do you think that they provide the correct type of information that a new or potential stockholder might need? Justify your position.

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