Question

Calstone, Inc. prepares an annual combined statement of income and comprehensive income. The following situations occurred during the company's 2015 fiscal year:
  
1. Land that had been held as an investment was sold and a gain was recognized. _________

2. Losses from foreign currency translation were recognized. ____________
3. Interest revenue was recognized.____________
4. A division was sold that qualifies as a separate component ______________
5. Unrealized losses on investments accounted for as securities available for sale were recorded.___

6. Investments were sold during the year at a loss of $300 __________
7. The controller discovered an error in the calculation of 2014's revenue.____________
8. Restructuring costs were incurred due to downsizing and reorganization of a manufacturing facility.
     ________

9. Calstone recorded an actuarial gain on its defined pension plan.
10. A write-down of inventory was recorded.

Required: For each situation, identify the appropriate reporting treatment from the list below (consider each event to be material).

1. As a component of operating income.
2. As a non-operating income item (other income or expense).
3. As a separately reported item.
4. As an item of other comprehensive income.
5. As an adjustment to retained earnings.

Answer 1

Answers:

1.As a non-operating income item (other income or expense).

2.As an item of other comprehensive income.

3.As a non-operating income item (other income or expense).

4.As a separately reported item.

5.As an item of other comprehensive income.

6.As a non-operating income item (other income or expense).

7.As an adjustment to retained earnings.

8.As a component of operating income.

9.As a non-operating income item (other income or expense).

10.As an adjustment to retained earnings.

Thanks....

answered by: anonymous