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Under new accounting standards passed in 2006 firms

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11.Under new accounting standards passed in 2006 firms must report changes in accountingprinciple in the current and prior years as if the new accounting principle had been applied allalong. The rationale for this change was
12.During July 2013 Ralston Company decides to dispose of one of its subsidiaries which qualifiesfor accounting as a discontinued operation. At the July2013 measurement date RalstonCompany estimates that it will report net income of $300,0000 dollars from the measurementdate until the disposal date which is expected to be in April 2014 In addition, Ralston estimatesthat it will lose100,000 on the sale of the segment. How much gain or loss on discontinuedoperations will Ralston report in its 2012 income statement (net of income taxes)?
13.During July 2012 Ralston Company decides to dispose of one of its subsidiaries which qualifiesfor accounting as a discontinued operation. At the July 2012 measurement date RalstonCompany estimates that it will report net losses of $1,500,000 dollars from the measurementdate until the disposal date which is expected to be in April 2013. In addition, Ralston estimatesthat it will lose $300,000 on the sale of the segment. How much gain or loss on discontinuedoperations will Ralston report in its 2012 income statement (net of income taxes)?
14.Which of the following doesnotdescribe an extraordinary gain or loss?
15.Which of the following items is consistent with earningsnotbeing informative about currentperformance but are informative about future earnings?
16.Which of the following items is consistent with earnings being informative about currentperformance butnotinformative about future earnings?
17.Which of the following items is consistent with earnings being informative about currentperformance and informing the analyst that level of current earnings is sustainable?

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Term
Fall
Professor
CHLUDZINSKI
Tags
Balance Sheet, Depreciation, Generally Accepted Accounting Principles

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