1 RequirementComplete the following table by indicating:1. The section of the income statement where the item should be included (e.g., operating, non-operating, discontinued operations), and2. Whether the event is reported net of tax.The first event is completed as a guide.Income StatementReported NetEventClassificationof Tax?Loss on disposal of equipmentNon-operatingNoGain on sale of plant assetsImpairment lossLoss on inventory write-off after government prohibitionOperating incomeUnrealized loss on available-for-sale investmentsGain on disposal of expropriated landUnrealized gain on trading securitiesOperating income of discontinued divisionLoss on inventory write-off due to obsolescence

Gain on sale of plant assets is a non operating because plant are used to manufacture and not used…

Requirement Complete the following table by indicating: 1. The section of the income statement where the item should be included (e.g., operating, non-operating, discontinued operations), a 2. Whether the event is reported net of tax. The first event is completed as a guide. Income Statement Reported Net Event Classification of Tax? Loss on disposal of equipment Non-oporating No Gain on sale of plant assets Impairment loss Loss on inventory write-off after government prohibition Operating income Unrealized loss on available-for-sale investments Gain on disposal of expropriated land Unrealized gain on trading securities Operating income of discontinued division Loss on inventory write-off due to obsolescence

Requirement Complete the following table by indicating: 1. The section of the income statement where the item should be included (e.g., operating, non-operating, discontinued operations), a 2. Whether the event is reported net of tax. The first event is completed as a guide. Income Statement Reported Net Event Classification of Tax? Loss on disposal of equipment Non-oporating No Gain on sale of plant assets Impairment loss Loss on inventory write-off after government prohibition Operating income Unrealized loss on available-for-sale investments Gain on disposal of expropriated land Unrealized gain on trading securities Operating income of discontinued division Loss on inventory write-off due to obsolescence

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter18: Accounting For Income Taxes

Section: Chapter Questions

Problem 10MC: Which component of current income is not disclosed on the income statement net of tax effects? a....

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