Exam 5: Statements of Net Income and Comprehensive Net Income

In what ways do the accounting standards allow companies to report comprehensive income in the financial statements?

Which of the following is not a subtotal on the multi-step income statement?

The four income statement elements are gains, losses, revenues, and expenses.

Profitability analysis is an evaluation of ________.

There is a noncontrolling interest when ________.

What are the most common approaches management uses to manipulate earnings?

How is reporting for other comprehensive income (OCI) different between U.S. GAAP and IFRS?

The two parts that compose comprehensive income are operating income and net income.

Which of the following items does IFRS require to be disclosed but not necessarily presented on the income statement?

Which of the following transactions is not reported as other comprehensive income by either U.S. GAAP or IFRS?

What items are included in a company's results from discontinued operations? For this purpose, how is a component defined?

Which of the following is not a characteristic that must be considered when determining that a business activity is a component of an entity for purposes of classifying that activity as a discontinued operation?

Based on the following income statement, prepare a common-size income statement based on sales. Round to two decimal places. Cash $60,000 Accounts receivable, net of allowance for doubtful accounts 550,000 Inventory 650,000 Total current assets $1,260,000 Property, plant, and equipment net of depreciation 1,300,000 Total assets $2,560,000 Accounts payable $270,000 Salaries payable 80,000 Taxes payable 55,000 Total current liabilities $405,000 Bonds payable 900,000 Total liabilities $1,305,000 Common stock 450,000 Retained earnings 805,000 Total liabilities and stockholders' equity $2,560,000

Why do companies issue condensed income statements?

Which of the following measures profit margin?

The following data include all the elements from Tuche Millinery's income statement: Administrative Expense \ 220 Cost of Goods Sold 261 Gain on Sale of Securities 43 Income Tax Expense 51 Loss on Discontinued Operations 38 Loss on Disposal of Equipment 86 Revenue 878 Selling Expense 124 What is the amount of gross profit for Tuche Millinery?

When a company decides to discontinue an operation, it values the assets and liabilities of that operation at ________ if this amount is lower than the carrying value.

Currently, under U.S. GAAP, what are the three items of other comprehensive income? Why should these items not flow through net income?

IFRS requires companies to present specific items on the income statement including write-downs of inventories and litigation settlements.

U.S. GAAP requires firms to classify revenues and expenses using the functional approach.