1.The distinction between operating and non-operating income relates to: continu
ID: 2373350 • Letter: 1
Question
1.The distinction between operating and non-operating income relates to:
continuity of income.
principal activities of the reporting entity.
consistency of income stream.
reliability of measurements.
2. On June 1, 2013, Romano Inc. changed the estimated useful life of its office equipment from 20 to 12 years. This change would be accounted for:
prospectively.
retrospectively.
as an accounting error.
none of the above.
3. Cash flows from investing activities do not include:
proceeds from issuing bonds.
payment for the purchase of equipment.
proceeds from the sale of marketable securities.
cash outflows from acquiring land.
4. Each of the following would be reported as items of other comprehensive income except:
foreign currency translation gains.
unrealized gains on investments accounted for as securities available for sale.
deferred gains from derivatives.
gains from the sale of equipment.
5. Reporting comprehensive income according to International Financial Reporting Standards can be accomplished by each of the following methods except:
in the statement of shareholders' equity.
a combined statement of income and comprehensive income.
a separate statement of comprehensive income.
the entity may choose either (b) or (c).
6. The balance sheet reports:
net income at a point in time.
cash flows for a period of time.
assets and equities at a point in time.
assets and liabilities for a period of time.
Explanation / Answer
Hi,
Please find the answers as follows:
1) Principal activities of the reporting entity
2) Prospectively
3) Proceeds from issuing bonds
4) Gains from the sale of equipment
5) In the statement of shareholders' equity
6) Assets and equities at a point in time
Thanks.
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