5. S1: For the results of a component of an entity to be classified as discontinued operation, management must have entered in a sale agreement.S2: The net income or net loss from discontinued operation, net of tax shall be shown as a single amount in the income statement after income from continuing operations and before net income. * A. Both statements are true B. Both statements are false C. Only statement 1 is true D. Only statement 2 is true 6. The fuel and oil as a major line of business of San Miguel Enterprises becomes available for immediate sale in its present condition. The termination costs of employees resulting from the discontinuance should be * A. Included in the computation of other comprehensive income B. Shown as other expense O c. Shown as a prior period adjustment D. Netted against the income from operations of the component as part of discontinued operation E. None of them

5. S1: For the results of a component of an entity to be classified as discontinued operation, management must have entered in a sale agreement.S2: The net income or net loss from discontinued operation, net of tax shall be shown as a single amount in the income statement after income from continuing operations and before net income. * A. Both statements are true B. Both statements are false C. Only statement 1 is true D. Only statement 2 is true 6. The fuel and oil as a major line of business of San Miguel Enterprises becomes available for immediate sale in its present condition. The termination costs of employees resulting from the discontinuance should be * A. Included in the computation of other comprehensive income B. Shown as other expense O c. Shown as a prior period adjustment D. Netted against the income from operations of the component as part of discontinued operation E. None of them

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Fraud Investigators Incorporated operates a fraud detection service. a. On March 31, 10 customers were billed for detection services totaling $33,000. b. On October 31, a customer balance of $1,900 from a prior year was determined to be uncollectible and was written off. c. On December 15, a customer paid an old balance of $820, which had been written off in a prior year. d. On December 31, $580 of bad debts were estimated and recorded for the year.
Use the following information from separate companies a through d: Net Income (Loss) Interest Expense Income Taxes a. $ 111, 000 $ 59, 940 $ 27, 750 b. 105, 600 25, 344 38,016 c. 94, 350 25, 475 39, 627 d . 114, 100 4,564 54,768 Compute times interest earned. Which company indicates the strongest ability to pay interest expense as it comes due?
Owner's equity Select one: a. The resulting amount when total liabilities are subtracted from total assets b. When total liabilities are added to total assets c. None of Them d. The resulting amount when total revenue are subtracted from total cost of sales
Which statement is incorrect? a. Under the transactions approach, net income is computed as the excess of income over expenses b. Under the capital maintenance approach, net income is computed as the excess of ending capital over beginning capital, excluding the effect of investments and withdrawals by owners. c. Unusual and infrequent items of expenses should be presented in in the income statement as a component of income from continuing operation. d. The single statement of comprehensive income shows a detailed presentation of all income and expenses, regardless of whether these income and expenses are recognized or not in the profit or loss. e. None of the above Statement 1: In the statement of changes in equity, the effect of the correction of a prior period error is presented separately for each component of equity. Statement 2: Preference share dividend appear under the retained earnings section of the statement of changes in equity. a. True, True b. False,…
Which of the following statements related to multiple-step Statement of Profit or Loss is not true? O The first section of the statement reports gross profit. O Subtotals for total selling expenses and general and administrative expenses are reported. O Non-operating items are reported separately from operations. O Shows only one total for expenses.
1(a) State with reason whether the following statements are true or false (i) Change in Method of Depreciation is regarded as change in Accounting Policy of the entity. (ii) Depreciation is non-cash and non- operating expense which is to be provided for whether there are profits/losses. (iii) Net Profit is reflected in higher cash balances and net loss is reflected in lower net worth. (iv) Contingent liability is an ascertained liability but its amount and due date are indeterminate. (v) Fundamental Assumptions are always required to be disclosed in the financial statements.
1. Directly attributable costs include:I. Interest Expense when the asset is ready for useII. Value-added taxes, the entity is not VAT-registered a. I onlyb. II onlyc. Both I and IId. Neither I nor II2. Computation of maximum dividend of wasting asset corporations include the following, except: I. Appropriated retained earningsII. Realized portion of accumulated depletiona. I onlyb. II onlyc. I and IId. None from I and IIPLEASE ADD REFERENCE FOR ANSWERPS: NOT SATISFIED WITH THE ANSWER OF LAST TUTOR
What is the accounting treatment for discontinued operations? A : It is reported at its gross amount as an "other revenue or gain" or "other expense or loss". B : It is reported as an "other revenue or gain" or "other expense and loss", net of tax. C : It only needs to be disclosed in the footnotes of the financial statements. D : It may be treated as sales revenue (if it is a gain) and as an operating expense (if it is a loss).
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Which limitation of an income statement occurs when one company uses an accelerated depreciation method while another company uses straight-line depreciation? O Companies omit from the income statement items they cannot measure reliably. O Income measurement involves judgment. O Income numbers are affected by the accounting methods employed. All of these answer choices are correct.
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