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DISCONTINUED OPERATIONS | 9 Months Ended
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Sep. 25, 2021
Discontinued Operations And Disposal Groups [Abstract] |
DISCONTINUED OPERATIONS | NOTE 13. DISCONTINUED OPERATIONS In January 2021, the Company’s Board of Directors announced that as a result of a business review of CompuCom, management has initiated a process to explore a value-maximizing sale of the Company’s former CompuCom Division to maximize CompuCom’s full potential and drive forward its future value and success. On June 29, 2021, the Company’s Board of Directors aligned with management’s commitment to a plan to sell CompuCom through a single disposal group. Although management did not bring forth a specific transaction to the Board of Directors, the Company is actively marketing CompuCom for sale at a price that the Company believes is reasonable in relation to CompuCom’s current fair value. CompuCom is available for immediate sale in its present condition and any sale is expected to be subject to customary regulatory approvals. Based on these considerations, and management’s experience and ability to complete similar transactions in the past, management believes the sale is probable and expects to complete it within one year from June 29, 2021. However, there can be no assurances regarding the ultimate timing of the planned disposition of CompuCom or that such disposition will be completed. The CompuCom disposal group has met the accounting criteria to be classified as held for sale as of June 29, 2021 and is presented as such in the Condensed Consolidated Balance Sheets as of September 25, 2021 and December 26, 2020. The planned disposition of CompuCom represents a strategic shift that will have a major impact on the Company’s operations and financial results. Accordingly, the Company intends to present the operating results and cash flows of its CompuCom Division as discontinued operations for all periods presented. Merger and restructuring expenses incurred by the former CompuCom Division, that were previously presented as Corporate expenses, are included in the measurement and presentation of discontinued operations in all periods presented. The following table represents a reconciliation of the major components of discontinued operations, net of tax presented in the Condensed Consolidated Statements of Operations.
|  | Third Quarter |  |  | Year-to-Date |
(In millions) |  | 2021 |  |  | 2020 |  |  | 2021 |  |  | 2020 |
Major components of discontinued operations before income taxes: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Sales: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Products |  | $ | 66 |  |  | $ | 44 |  |  | $ | 182 |  |  | $ | 165 |
Services |  |  | 135 |  |  |  | 148 |  |  |  | 428 |  |  |  | 470 |
Total sales |  |  | 201 |  |  |  | 192 |  |  |  | 610 |  |  |  | 635 |
Cost of goods and occupancy costs: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Products |  |  | 57 |  |  |  | 39 |  |  |  | 160 |  |  |  | 150 |
Services |  |  | 104 |  |  |  | 110 |  |  |  | 331 |  |  |  | 350 |
Total cost of goods and occupancy costs |  |  | 161 |  |  |  | 149 |  |  |  | 491 |  |  |  | 500 |
Gross profit |  |  | 40 |  |  |  | 43 |  |  |  | 119 |  |  |  | 135 |
Selling, general and administrative expenses |  |  | 29 |  |  |  | 40 |  |  |  | 117 |  |  |  | 128 |
Asset impairments |  |  | — |  |  |  | — |  |  |  | 114 |  |  |  | 248 |
Merger, restructuring and other operating expenses, net |  |  | — |  |  |  | 2 |  |  |  | (2 | ) |  |  | 18 |
Operating income (loss) |  |  | 11 |  |  |  | 1 |  |  |  | (110 | ) |  |  | (259 | )
Other income, net |  |  | — |  |  |  | — |  |  |  | (1 | ) |  |  | 1 |
Income (loss) from major components of discontinued operations before income taxes |  |  | 11 |  |  |  | 1 |  |  |  | (111 | ) |  |  | (258 | )
Loss from classification to held for sale |  |  | (1 | ) |  |  | — |  |  |  | (1 | ) |  |  | — |
Income (loss) from discontinued operations before income taxes |  |  | 10 |  |  |  | 1 |  |  |  | (112 | ) |  |  | (258 | )
Income tax benefit |  |  | (18 | ) |  |  | (22 | ) |  |  | (23 | ) |  |  | (15 | )
Discontinued operations, net of tax |  | $ | 28 |  |  | $ | 23 |  |  | $ | (89 | ) |  | $ | (243 | )
The following table represents the major classes of assets and liabilities of the disposal group classified as held for sale presented in the Condensed Consolidated Balance Sheets as of September 25, 2021 and December 26, 2020.
|  | September 25, |  |  | December 26, |
(In millions) |  | 2021 |  |  | 2020 |
Major classes of assets included in discontinued operations: |  |  |  |  |  |  |  |
Receivables, net |  | $ | 209 |  |  | $ | 189 |
Inventories |  |  | 23 |  |  |  | 14 |
Prepaid expenses and other current assets |  |  | 18 |  |  |  | 16 |
Total current assets |  |  |  |  |  |  | 219 |
Property and equipment, net |  |  | 24 |  |  |  | 26 |
Operating lease right-of-use assets |  |  | 64 |  |  |  | 62 |
Goodwill |  |  | 112 |  |  |  | 214 |
Other intangible assets, net |  |  | 281 |  |  |  | 301 |
Other assets |  |  | 14 |  |  |  | 19 |
Total noncurrent assets |  |  |  |  |  |  | 622 |
Less: valuation allowance |  |  | (1 | ) |  |  |  |
Total assets of the disposal group classified as held for sale |  | $ | 744 |  |  | $ | 841 |
Major classes of liabilities included in discontinued operations: |  |  |  |  |  |  |  |
Trade accounts payable |  | $ | 71 |  |  | $ | 62 |
Accrued expenses and other current liabilities |  |  | 76 |  |  |  | 90 |
Total current liabilities |  |  |  |  |  |  | 152 |
Deferred income taxes and other long-term liabilities |  |  | 76 |  |  |  | 82 |
Operating lease liabilities |  |  | 49 |  |  |  | 56 |
Total noncurrent liabilities |  |  |  |  |  |  | 138 |
Total liabilities of the disposal group classified as held for sale |  | $ | 272 |  |  | $ | 290 |

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- Definition The entire disclosure related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 360 -URI http://asc.fasb.org/topic&trid=2155823 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=2122178 + Details
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