Discontinued Operations are parts of a company’s core business or product line that have been divested or shut down, and which are reported separately from continuing operations on the income statement. This line item shows the net income or loss from the discontinued operations, net of tax, and any gain or loss from their disposal. A discontinued operation must meet two criteria: First, the asset or business component must be disposed of or reported as being held for sale. Second, the component must be distinguishable as a separate business that is being removed from operation intentionally.