View the step-by-step solution to: 1. (TCO 5) The distinction between operating and non-operating

This question was answered on Sep 19, 2012. View the Answer
1. (TCO 5) The distinction between operating and non-operating income relates to: (Points : 4)
continuity of income.
principal activities of the reporting entity.
consistency of income stream.
reliability of measurements.

2. (TCO 5) On August 1, 2011, Rocket Retailers adopted a plan to discontinue its catalog sales division, which qualifies as a separate component of the business, according to GAAP regarding discontinued operations. The disposal of the division was expected to be concluded by June 30, 2012. On January 31, 2012, Rocket's fiscal year-end, the following information relative to the discontinued division was accumulated:

In its income statement for the year ended January 31, 2012, Rocket would report a before-tax loss on discontinued operations of:

(Points : 4)

3. (TCO 5) Changes in accounting estimates are reported: (Points : 4)
currently and prospectively.
retroactively and currently.
retroactively, currently, and prospectively.
by restating prior years.

4. (TCO 5) Cash flows from financing activities include: (Points : 4)
interest received.
interest paid.
dividends received.
dividends paid.

5. (TCO 5) Review Rowdy's Restaurants cash flow (in millions):

Rowdy's would report net cash inflows (outflows) from financing activities in the amount of:

(Points : 4)


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The distinction between operating and non-operating income relates to:
continuity of income.
Principal activities of the reporting entity.
Consistency of income stream.
Reliability of...

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