Becker - FAR F1 Flashcards

Income from Continuing Operations

When a fixed asset is sold, the gain/loss is recognized as part of…?

Comprehensive Income

Includes all changes in equity during a period except those resulting from owner investments and distributions to owners

Single Statement Method

Net income and other comprehensive income are shown together in one statement

Two Statement Method

Net income is shown in one statement, and other comprehensive income is shown in a separate statement right after; Companies have the choice of reporting each line net of tax or before related taxes, with one amount shown for the aggregate income tax expense or benefit related to the total of all comprehensive income items

Gain or Loss

Under U.S. GAAP, the effect of a material transaction that is infrequent in occurrence but not unusual in nature should be presented separately as a component of income from continuing operations when the transaction results in a…

True

The calculation of comprehensive income includes losses on discontinued operations.

True or False?

Net Concept

You show just the difference between what you got and what the asset was worth

Gross Concept

You show everything separately.

• For example, if you sell an asset:

  • You show the full sale price as revenue.

  • You show the full cost or carrying amount of the asset as an expense

Income from Continuing Operations

Under U.S. GAAP, a gain that is both unusual and infrequent should be reported as…?