The CEO of Jones Ltd. has thought about closing down its European division and selling...
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Accounting
The CEO of Jones Ltd. has thought about closing down its European division and selling the assets there to a local company. A tentative marketing plan has been devised, however no buyer has been identified and it is unclear when, or if, the sale will happen. What is implied here?
A. Jones Ltd. may choose from any of these options as GAAP permits all three, at the companys discretion.
B. The European division can be reclassified now as a discontinued operation since it is held for sale.
C. As nothing concrete has yet happened, no adjustment or disclosure needs to be made.
D. The European division does not qualify as a discontinued operation, but an impairment write-down must be recorded for it.
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