Question

Unusual or Infrequent Item                                      &

  1. Unusual or Infrequent Item                                             
  2. Equity Earnings
  3. Discontinued Operations
  4. Extraordinary Items
  5. Change in Accounting Principle
  6. Net earnings related to Non-controlling Interest

A. ______Which of the above items, if material, is reported on its own line and above earnings before taxes on a pre-tax basis?  

B. ______Which of the above items is reported on Amazon’s income statement after the line item for income tax provision?

______True or False: The item in #2 above is reported net of tax

Homework Answers

Answer #1

A. Unusual or Infrequent items are incomes not in the ordinary course of business. Example. Income on sale of fixed assets etc..

These items should disclosed in the income statement through seperate line item, if material on pretax basis.

Ans) A. Unusual or Infrequent Item

B. Which of the above items is reported on Amazon’s income statement after the line item for income tax provision?

Ans) Net earnings related to Non-controlling Interest (Minority/ non controlling interest) is reported on Amazon’s income statement after the line item for income tax provision

C. The item in #2 above is reported net of tax

Ans) True. The Net earnings related to Non-controlling Interest disclosed after tax

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