Question 1

Which of the following is not a generally practiced method of presenting the income statement?

Accepted Answer

A) Including prior period adjustments in determining net income. 
B) The condensed income statement. 
C) The consolidated income statement. 
D) Including gains and losses from discontinued operations of a component of a business in determining net income. 
A) Including prior period adjustments in determining net income. 
B) The condensed income statement. 
C) The consolidated income statement. 
D) Including gains and losses from discontinued operations of a component of a business in determining net income.

Question 2

A change in accounting principle requires that the cumulative effect of the change for prior periods be shown as an adjustment to

Accepted Answer

A) beginning retained earnings for the earliest period presented. 
B) net income for the period in which the change occurred. 
C) comprehensive income for the earliest period presented. 
D) stockholders' equity for the period in which the change occurred. 
A) beginning retained earnings for the earliest period presented. 
B) net income for the period in which the change occurred. 
C) comprehensive income for the earliest period presented. 
D) stockholders' equity for the period in which the change occurred.

Question 3

The income statement information would help in which of the following tasks?

Accepted Answer

A) Evaluate the liquidity of a company. 
B) Evaluate the solvency of a company. 
C) Estimate future cash flows. 
D) Estimate future financial flexibility. 
A) Evaluate the liquidity of a company. 
B) Evaluate the solvency of a company. 
C) Estimate future cash flows. 
D) Estimate future financial flexibility.

Question 4

Earnings per share relate to

Accepted Answer

A) preference shares only. 
B) ordinary shares only. 
C) both preference and ordinary shares. 
D) neither preference nor ordinary shares. 
A) preference shares only. 
B) ordinary shares only. 
C) both preference and ordinary shares. 
D) neither preference nor ordinary shares.

Question 5

Which of the following is a required disclosure in the income statement when reporting the disposal of a component of the business?

Accepted Answer

A) The gain or loss on disposal should be reported as an other income item. 
B) Results of operations of a discontinued component should be disclosed immediately below income from operations. 
C) Earnings per share from both continuing operations and net income should be disclosed on the face of the income statement. 
D) The gain or loss on disposal should not be segregated, but should be reported together with the results of continuing operations. 
A) The gain or loss on disposal should be reported as an other income item. 
B) Results of operations of a discontinued component should be disclosed immediately below income from operations. 
C) Earnings per share from both continuing operations and net income should be disclosed on the face of the income statement. 
D) The gain or loss on disposal should not be segregated, but should be reported together with the results of continuing operations.

Question 6

The major elements of the income statement are

Accepted Answer

A) revenue, cost of goods sold, selling expenses, and general expense. 
B) operating section, nonoperating section, discontinued operations and cumulative effect. 
C) revenues, expenses, gains, and losses. 
D) All of these. 
A) revenue, cost of goods sold, selling expenses, and general expense. 
B) operating section, nonoperating section, discontinued operations and cumulative effect. 
C) revenues, expenses, gains, and losses. 
D) All of these.

Question 7

Earnings management generally makes income statement information more useful for predicting future earnings and cash flows.

Accepted Answer

A) True 
 B)False

Question 8

Prior period adjustments can either be added or subtracted in the Retained Earnings Statement.

Accepted Answer

A) True 
 B)False

Question 9

A company recognizes a change in estimate by making a retrospective adjustment to the financial statements.

Accepted Answer

A) True 
 B)False

Question 10

In 2015, Milford Corporation determined that it overstated salaries payable and salaries expense by $20,000 in 2014.In 2015, which of the following accounts will have to be credited to correct this error?

Accepted Answer

A) Salaries and Wages Payable. 
B) Salaries and Wages Expense. 
C) Retained Earnings. 
D) Income Summary. 
A) Salaries and Wages Payable. 
B) Salaries and Wages Expense. 
C) Retained Earnings. 
D) Income Summary.

Question 11

A correction of an error in prior periods' income will be reported

Accepted Answer

The answer of A correction of an error in prior...

Question 12

Companies use intraperiod tax allocation for all of the following items except

Accepted Answer

A) discontinued operations. 
B) prior period adjustments. 
C) changes in accounting estimates. 
D) income from continuing operations. 
A) discontinued operations. 
B) prior period adjustments. 
C) changes in accounting estimates. 
D) income from continuing operations.

Question 13

Comprehensive income can be reported in a statement of changes in equity.

Accepted Answer

A) True 
 B)False

Question 14

Comprehensive income includes all changes in equity during a period except those resulting from distributions to owners.

Accepted Answer

A) True 
 B)False

Which of the following is not a generally practiced method of presenting the income statement?

A change in accounting principle requires that the cumulative effect of the change for prior periods be shown as an adjustment to

The income statement information would help in which of the following tasks?

Earnings per share relate to

Which of the following is a required disclosure in the income statement when reporting the disposal of a component of the business?

The major elements of the income statement are

Earnings management generally makes income statement information more useful for predicting future earnings and cash flows.

Prior period adjustments can either be added or subtracted in the Retained Earnings Statement.

A company recognizes a change in estimate by making a retrospective adjustment to the financial statements.

In 2015, Milford Corporation determined that it overstated salaries payable and salaries expense by $20,000 in 2014.In 2015, which of the following accounts will have to be credited to correct this error?

A correction of an error in prior periods' income will be reported

Companies use intraperiod tax allocation for all of the following items except

Comprehensive income can be reported in a statement of changes in equity.

Comprehensive income includes all changes in equity during a period except those resulting from distributions to owners.

Financial Reporting and Accounting Standards

Conceptual Framework for Financial Reporting

The Accounting Information System

Statement of Financial Position and Statement of Cash Flows

Accounting and the Time Value of Money

Cash and Receivables

Valuation of Inventories: a Cost-Basis Approach

Inventories: Additional Valuation Issues

Acquisition and Disposition of Property, Plant, and Equipment

Depreciation, Impairments, and Depletion

Intangible Assets

Current Liabilities, Provisions, and Contingencies

Non-Current Liabilities

Equity

Dilutive Securities and Earnings Per Share

Investments

Revenue Recognition

Accounting for Income Taxes

Accounting for Pensions and Postretirement Benefits

Accounting for Leases

Accounting Changes and Error Analysis

Statement of Cash Flows

Presentation and Disclosure in Financialreporting

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Exam 4: Income Statement and Related Information

Which of the following is not a generally practiced method of presenting the income statement?

A change in accounting principle requires that the cumulative effect of the change for prior periods be shown as an adjustment to

The income statement information would help in which of the following tasks?

Earnings per share relate to

Which of the following is a required disclosure in the income statement when reporting the disposal of a component of the business?

The major elements of the income statement are

Earnings management generally makes income statement information more useful for predicting future earnings and cash flows.

Prior period adjustments can either be added or subtracted in the Retained Earnings Statement.

A company recognizes a change in estimate by making a retrospective adjustment to the financial statements.

In 2015, Milford Corporation determined that it overstated salaries payable and salaries expense by $20,000 in 2014.In 2015, which of the following accounts will have to be credited to correct this error?

A correction of an error in prior periods' income will be reported

Companies use intraperiod tax allocation for all of the following items except

Comprehensive income can be reported in a statement of changes in equity.

Comprehensive income includes all changes in equity during a period except those resulting from distributions to owners.

Financial Reporting and Accounting Standards

Conceptual Framework for Financial Reporting

The Accounting Information System

Statement of Financial Position and Statement of Cash Flows

Accounting and the Time Value of Money

Cash and Receivables

Valuation of Inventories: a Cost-Basis Approach

Inventories: Additional Valuation Issues

Acquisition and Disposition of Property, Plant, and Equipment

Depreciation, Impairments, and Depletion

Intangible Assets

Current Liabilities, Provisions, and Contingencies

Non-Current Liabilities

Equity

Dilutive Securities and Earnings Per Share

Investments

Revenue Recognition

Accounting for Income Taxes

Accounting for Pensions and Postretirement Benefits

Accounting for Leases

Accounting Changes and Error Analysis

Statement of Cash Flows

Presentation and Disclosure in Financialreporting

Filters