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Which statement is incorrect? *
The FUNCTIONAL Income Statement classifies expenses into cost of sales, selling expenses and general administrative expenses, among others.
Income encompasses both revenues and gains. Revenues arise in the ordinary course of business activities while gains are not.
Expenses encompasses both expenses and losses. Losses usually comprise the majority amount of deductible expenses to arrive at taxable income.
The statement of comprehensive income encompasses all income and expenses, whether they are recognized in profit or loss determination or recognized directly in equity.
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- If a functional expense classification is used for the statement of comprehensive income, what must also be disclosed?Which statement is incorrect? A. The FUNCTIONAL Income Statement classifies expenses into cost of sales, selling expenses and general administrative expenses, among others. B. Income encompasses both revenues and gains. Revenues arise in the ordinary course of business activities while gains are not. C. Expenses encompasses both expenses and losses. Losses usually comprise the majority amount of deductible expenses to arrive at taxable income. D. The statement of comprehensive income encompasses all income and expenses, whether they are recognized in profit or loss determination or recognized directly in equity. E. none of the aboveWhich statement is incorrect? *A.the FUNCTIONAL Income Statement classifies expenses into cost of sales, selling expenses and general administrative expenses, among others .b.Income encompasses both revenues and gains. Revenues arise in the ordinary course of business activities while gains are not. c.Expenses encompasses both expenses and losses. Losses usually comprise the majority amount of deductible expenses to arrive at taxable income. d.The statement of comprehensive income encompasses all income and expenses, whether they are recognized in profit or loss determination or recognized directly in equity. e.none of the above
- Which statement is incorrect? * The FUNCTIONAL Income Statement classifies expenses into cost of sales, selling expenses and general administrative expenses, among others. Income encompasses both revenues and gains. Revenues arise in the ordinary course of business activities while gains are not. Expenses encompasses both expenses and losses. Losses usually comprise the majority amount of deductible expenses to arrive at taxable income. The statement of comprehensive income encompasses all income and expenses, whether they are recognized in profit or loss determination or recognized directly in equity. none of the aboveThe following are deductions from items of income, except: * Cost of sales or service Regular allowable deductions Net Operating Loss Carry-Over Net Capital Loss Carry-OverWhich is incorrect concerning the presentation of Income Statement? A. When items of income and expense are material, their nature and amount shall be disclosed separately. B. An entity shall present extraordinary items separately on the face of the income statement or in the notes to F/S. C. Natural presentation means that expenses are aggregated according to their nature like depreciation and employee benefits. D. Cost of sales method classifies expenses according to their function such as cost of sales, cost of distribution and cost of administrative activities. E. Both the natural presentation and functional presentation has their own merits for different types of entities, so the standard allows management to choose which they think is more relevant and reliable presentation.
- Discuss the main reasons why accounting profit of a business has to be adjusted when computing taxable income.Comprehensive income includes: profit or Loss only other comprehensive income only both profit or loss and other comprehensive income neither profit or loss nor other comprehensive incomeUnearned income is credited to the Profit and loss account. Do you agree with the statement?
- When transitory earnings are present, which of the following correctly depicts the order used on the income statement? Multiple Choice Income tax expense, income from continuing operations, unusual items, discontinued operations, net income. Income from continuing operations, unusual items, income tax expense, discontinued operations, net income. Income from continuing operations, discontinued operations, income tax expense, net income. Income tax expense, income from continuing operations, discontinued operations, net income.Discuss the accounting concepts behind reporting unearned income.Which of the following refers to the elements of Comprehensive Income? a) Net Income, Interest Payments and Income Tax Payments b) Retained Earnings and Other Comprehensive Income c) Net Income and Other Comprehensive Income d) Sales and Other Comprehensive Income