What are FASB's requirements for how a company reports gains from a lawsuit settlement on the income statement

Answer 1

Under FASB Statement No. 145, material gains and losses are classified as extraordinary on the income statement only when they are unusual AND infrequent. Extraordinary items are reported at the bottom of the income statement, net of their income tax effects. A note to the financial statements is necessary to explain the item.

Click on the link for a discussion as well as sample disclosure notes.

Answer 2

I think it has something to do with contengencies... However, I believe it will be treated the same as revenue