Income From Continuing Operations Example

Since one time events and the results of discontinued operations are excluded this measure is considered to be a prime indicator of the financial health of a firm s core activities.

Income from continuing operations example. Net income from continuing operations is a line item on the income statement that notes the after tax earnings that a business has generated from its operational activities. The segment earned revenue of usd 200 million and incurred costs of usd 150 million. The example also shows how net income 200 000 is at times greater than operating income 170 000 due to other items in this case income from discontinued operations 20 000 and extraordinary. Its book value was usd 100 million.

To calculate the income from continuing operations subtract the cost of goods sold and other operating expenses such as cost from labor from the revenue earned from the day to day operations of a business. Income from operations is calculated using the formula given below income from operations net income interest expense taxes income from operations 54 286 million 3 240 million 13 372 million income from operations 70 898 million. The gain or loss. Example of income from operations for example if a car company spends 100 000 building and selling cars then sells them for 110 000 it has 10 000 in income from operations.

For example a company reports 180 000 of sales 80 000 cost of goods sold and 15 000 of operating expenses. This figure represents the company s income before extraordinary items are added. Company c has income from continuing operations of usd 700 million. In the above example operating income is stated in the item called income from continuing operations which equals 170 000.

Using the same example adding 87 600 to 8 600 gives a figure of 96 200.