4-1 1. Understand the uses and limitations of an income statement. 2.Describe the content and format of the income statement. 3. Prepare an income statement. 4.Explain how to report various income items. 5.Identify where to report earnings per share information. 6. Understand the reporting of accounting changes and errors. 7. Prepare a retained earnings statement. 8.Explain how to report other comprehensive income.
4-6RevenuesExpensesNet IncomeSingle- StepSingle- StepNoimplication that one type of revenue or expense item has priority over another.Single-Step Income StatementsFormat of the Income StatementIllustration 4-5LO 3 Prepare an income statement.
4-7Condensed Income StatementsIllustration 4-3LO 3 Prepare an income statement.
4-8Format referred to as multiple-step income statement.Separates operating transactions from nonoperating transactions.Matches costs and expenses with related revenues.Highlights certain components of income that analysts use assessing financial performance.Format of the Income StatementIntermediate ComponentsLO 3 Prepare an income statement.
4-9CABRERA COMPANYIncome StatementFor The Year Ended December 31, 2014
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