Gliem

Palmyra Co. has net income of $11,000, a positive $1,000 net cumulative effect of a change in accounting principle, a $3,000 unrealized loss on available-for-sale debt securities, a positive $2,000 foreign currency translation adjustment, and a $6,000 increase in its common stock. What amount is Palmyra's comprehensive income?

$10,000

During the second quarter, Buzz Company sold a piece of equipment at a $12,000 gain. What portion of the gain should Buzz report in its income statement for the second quarter?

$12,000

A company reports the following information as of December 31: Sales revenue $800,000 Cost of goods sold 600,000 Operating expenses 90,000 Unrealized holding gain on available-for-sale debt securities, net of tax 30,000 What amount should the company report as comprehensive income as of December 31?

$140,000

On April 1, Julie began operating a service proprietorship with an initial cash investment of $1,000. The proprietorship provided $3,200 of services in April and received a payment of $2,500 in May. The proprietorship incurred expenses of $1,500 in April that were paid in June. During May, Julie drew $500 from her capital account. What was the proprietorship's income for the 2 months ended May 31 under the following methods of accounting?

$2,500 $1,700

Corey Co.'s income statement accounts for the year ended December 31, Year 2, included the following: Sales $800,000 Cost of sales 320,000 Administrative expenses 80,000 Interest expenses 10,000 Other Information Available-for-sale debt securities held by the company had fair values of $250,000 and $300,000 on December 31, Year 1, and December 31, Year 2, respectively. On December 31, Year 2, 70,000 shares of common stock, $1.00 par, were outstanding. Corey repurchased 25,000 shares on June 1, Year 2. Corey's enacted tax rate for the current and future years is 30%. Corey's comprehensive income is

$308,000

During the first quarter of Year 4, Tech Co. had income before taxes of $200,000, and its effective income tax rate was 15%. Tech's Year 3 effective annual income tax rate was 30%, but Tech expects its Year 4 effective annual income tax rate to be 25%. In its first quarter interim income statement, what amount of income tax expense should Tech report?

$50,000

On January 16, Tree Co. paid $60,000 in property taxes on its factory for the current calendar year. On April 2, Tree paid $240,000 for unanticipated major repairs to its factory equipment. The repairs will benefit operations for the remainder of the calendar year. What amount of these expenses should Tree include in its third quarter interim financial statements for the 3 months ended September 30?

$95,000

The summary of significant accounting policies should disclose the

Criteria for determining which investments are treated as cash equivalents.

Which of the following is a component of other comprehensive income?

Cumulative currency-translation adjustments.

Which of the following is correct concerning financial statement disclosure of accounting policies?

Disclosure of accounting policies is an integral part of the financial statements.

Which of the following is true regarding interim financial reporting?

Each interim period is viewed as a discrete reporting period under IFRS and as an integral part of an annual period under U.S. GAAP.

For interim financial reporting, a company's income tax provision for the second quarter should be determined using the

Effective tax rate expected to be applicable for the full year as estimated at the end of the second quarter.

A company that issues quarterly financial statements incurs a material unusual loss in one of the first three quarters. In which of the following ways would the company report this loss?

Entirely in the quarter that the loss occurs.

Other comprehensive income (OCI) includes

Gains and losses on certain derivatives designated, qualifying, and effective as foreign-currency hedging instruments.

Because of a decline in market price in the second quarter, Petal Co. incurred an inventory loss, but the market price was expected to return to previous levels by the end of the year. At the end of the year, the decline had not reversed. Petal accounts for its inventory using the LIFO method. When should the loss be reported in Petal's interim income statements?

In the fourth quarter only.

How are discontinued operations and material unusual or infrequently occurring items that occur at midyear initially reported?

Included in net income and disclosed in the notes to interim financial statements.

Which of the following items is not classified as other comprehensive income (OCI)?

Infrequent in occurrence gains from extinguishment of debt.

Which of the following describes how comprehensive income is reported under U.S. GAAP?

It must be reported in two separate but consecutive statements or in one continuous statement.

The accounting measurement that is not consistent with the going concern concept is

Liquidation value.

Farr Corp. had the following transactions during the quarter ended March 31: Loss on disposal of equipment $ 70,000 Payment of fire insurance premium for calendar year 100,000 What amounts should be included in Farr's income statement for the quarter ended March 31?

Loss on disposal Insurance Expense $70,000 $25,000

According to authoritative GAAP issued by the FASB, an entity that presents a full set of financial statements

Must report comprehensive income if it has items of other comprehensive income (OCI).

Which of the following items should be included in Melay, Inc.'s summary of significant accounting policies for the current year?

Property, plant, and equipment is recorded at cost with depreciation computed principally by the straight-line method.

For interim financial reporting, a gain on disposal of property occurring in the second quarter should be

Recognized in the second quarter.

Which of the following must be included in a summary of significant accounting policies in the notes to the financial statements?

Revenue recognition policies.

Comprehensive income is best defined as

The change in net assets for the period excluding owner transactions.

Conceptually, interim financial statements can be described as emphasizing

Timeliness over reliability.

In general, an enterprise preparing interim financial statements should

Use the same accounting principles followed in preparing its latest annual financial statements.

Comprehensive income includes

Yes Yes

For interim financial reporting, the computation of a company's second quarter provision for income taxes uses an effective tax rate expected to be applicable for the full fiscal year. The effective tax rate should reflect anticipated

Yes Yes

For interim financial reporting, which of the following may be accrued or deferred to provide an appropriate cost in each period?

Yes Yes