Calstone, Inc., prepares a single, continuous statement of comprehensive income.

Question

Calstone, Inc., prepares a single, continuous statement of comprehensive income. The following situations occurred during the company's 2018 fiscal year: For each situation below, identlfy the appropriate reporting treatment (consider each event to be materlal). 1. Land that had been held as an investment was sold and a gain was recognized 2. There was a negative foreign currency translation adjustment at December 31, 2018. 3. Interest revenue was recognized. A division was sold that qualifies as a separate component according to GAAP regarding ? discontinued operations. 5. There were unrealized holding losses on investments during the year. 6, Restructuring costs were incurred due to downsizing and reorganization of a manufacturing As a component of operating income As a discontinued operation As a nonoperating income item (other income or expense) As an item of other comprehensive income facility

Explanation / Answer

1) As a non operating income item (other income or expense) because land is considered as an investing item.

2) As an item of other comprehensive income because all reserves are part of OCI i.e. other comprehensive income.

3) As a component of operating Income.

4) As a discontinued operation because division has been sold.

5) As an item of other comprehensive income

6) As a component of operating income

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