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CHAPTER 4 INCOME STATEMENT AND RELATED INFORMATION IFRS questions are available at the end of this chapter. TRUE-FALSE Conceptual Answer No. Description T 1. Usefulness of the income statement. F 2. Limitations of the income statement. F 3. Earnings management. T 4. Transaction approach of income measurement. T 5. Single-step income statement. T 6. Revenues and gains. F 7. Multiple-step vs. single-step income statement. F 8. Multiple-step income statement. T 9. Multiple-step vs. single-step income statement. F 10. Current operating performance approach. T 11. Reporting discontinued operations. F 12. Reporting extraordinary items. F 13. Irregular items. T 14. Intraperiod tax allocation. F 15. Reporting earnings per share. F 16. Computation of earnings per share. T 17. Prior period adjustments. F 18. Retained earnings restrictions. F 19. Comprehensive income definition. T 20. Reporting other comprehensive income. MULTIPLE CHOICE Conceptual Answer No. Description c 21. Elements of the income statement. d 22. Usefulness of the income statement. b 23. Limitations of the income statement. d S 24. Use of an income statement. d S 25. Income statement reporting. c 26. Income statement information. b 27. Example of managing earnings down. c 28. Example of managing earnings up. b 29. Improving current net income. a 30. Decreasing current net income. d 31. Single-step income statement advantage. b 32. Single-step income statement. d 33. Methods of preparing income statements. a 34. Income statement presentation. b 35. Event with no income statement effect. Test Bank for Intermediate Accounting, Thirteenth Edition c S 36. Net income effect. MULTIPLE CHOICE Conceptual (cont.) Answer No. Description b P 37. Selling expenses. b P 38. Reporting merchandise inventory. a 39. Definition of an extraordinary item. d 40. Classification of an extraordinary item. d 41. Identification of an extraordinary item. a 42. Identification of an extraordinary item. d 43. Identification of an extraordinary item. a 44. Presentation of unusual or infrequent items. d 45. Identification of a change in accounting principle. d 46. Classification of extraordinary items. c 47. EPS disclosures on income statement. c 48. Reporting discontinued operations. c S 49. Reporting unusual or infrequent items. d 50. Intraperiod tax allocation. d 51. Purpose of intraperiod tax allocation. c 52. Intraperiod tax allocation. d 53. Reporting items net of tax. d 54. Reporting items at gross amount. c 55. Earnings per share disclosure. d 56. EPS disclosures on income statement. d 57. EPS disclosures on income statement. c S 58. Earnings per share disclosure. d P 59. Reporting correction of an error. c 60. Retained earnings statement.... View Full Document

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