Business
Engineering
Math
Science
Social Science
Intermediate Accounting: Reporting...
Solutions
Intermediate Accounting: Reporting...
Income Statement Deficiencies David Company’s income statements are presented here:
Additional facts are as follows:
- a. The loss from operations of the discontinued Drexler Division (a strategic component of the company) from January 1, 2020 to September 30, 2020 (the portion of the year prior to the date of sale), and from January 1, 2019 to December 31, 2019, is included in David's income statements for the year ended December 31, 2020 and December 31, 2019, respectively, in “other, net.”
- b. David has a simple capital structure with only common stock outstanding, and the net income per share of common stock was based on the weighted average number of common shares outstanding during each year.
- c. David’s common stock is listed on the New- York Stock Exchange and closed at $13 per share on December 31,2020, and $15 per share on December 31, 2019.
Required:
Next Level Determine from the additional facts listed whether the presentation of those facts in David’s income statements is appropriate. If the presentation is appropriate, discuss the rationale for the presentation. If the pre presentation is not appropriate, specify appropriate presentation and discuss its rationale. Do not discuss disclosure requirements for the notes to the financial statements.
Identify that the presentation of facts in Company D’s income statement is appropriate or not. If not specify the appropriate presentation and discuss the same.
Income statement: The financial statement which reports revenues and expenses from business operations and the result of those operations as net income or net loss for a particular time period is referred to as income statement.
Identify that the presentation of facts in Company D’s income statement is appropriate or not. If not specify the appropriate presentation and discuss the same:
In the given income statement, the loss from the discontinued operations from January 1, 2020 to September 31, 2020 and from January 1, 2019 to December 31, 2019 are included in the “Other, net”. This should be presented in the section of discontinuing operations not in the continuing operations section.
Appropriate presentation of Company D’s income statement:
- “Other, net” and “total costs and expenses” should be decreased by excluding the loss from the discontinued operations.
- By the above adjustment, “Income from continuing operations” will increase...
Chapter 5 Solutions
Additional Business Solutions
Find more solutions based on key concepts
Show solutions addList the steps involved in view integration.
Accounting Information Systems
PURCHASES AND CASH PAYMENTS TRANSACTIONS Emily Frank owns a small retail business called Franks Fantasy. The ca...
College Accounting, Chapters 1-27
Selected transactions for Babcock Company during November of the current year are listed in Problem 6-3A. Instr...
Financial Accounting
Carlyle Lighting Products produces two different types of lamps: a floor lamp and a desk lamp. Floor lamps sell...
Managerial Accounting: The Cornerstone of Business Decision-Making
Flexible overhead budget Leno Manufacturing Company prepared The following factory overhead cost budget for the...
Financial & Managerial Accounting
Analyze L Brands L Brands, Inc. (LB) sells womens clothing and personal health care products through specialty ...
Corporate Financial Accounting
Journal entry for asset purchase Prepare a journal entry for the purchase of office supplies on November 2 for ...
Financial And Managerial Accounting
What are the key provisions of SOX?
Accounting Information Systems
An economy consists of three workers: Larry, Moe, and Curly. Each works 10 hours a day and can produce two serv...
Essentials of Economics (MindTap Course List)
(Long-Run Industry Supply) Why does the long-run industry supply curve for an increasing-cost industry slope up...
ECON: MICRO4 (New, Engaging Titles from 4LTR Press)
As a manager, how might you deal with an employee who is always displaying negative emotions that affect the re...
Management, Loose-Leaf Version
Describe the two problems that arise when regulators tell a natural monopoly that it must set a price equal to ...
Principles of Economics (MindTap Course List)
How does the marketing environment affect a firms marketing strategy?
Foundations of Business (MindTap Course List)
Classify consumer products
MKTG 12:STUDENT ED.-TEXT
What is inflation and what causes it?
Principles of Microeconomics (MindTap Course List)
Given a description of a companys marketing mix, classify the elements of the marketing mix and the category of...
Contemporary Marketing
MVA Over the years. Masterson Corporations stockholders have provided 34,000,000 of capital when they purchased...
Fundamentals of Financial Management, Concise Edition (MindTap Course List)
Table 1.7 shows data for eight cordless telephones (Consumer Reports, November 2012). The Overall Score, a meas...
STATISTICS F/BUSINESS+ECONOMICS-TEXT
What is the difference between condusions and recommendations in a report?
Essentials of Business Communication (MindTap Course List)
If a nations currency doubles in value on foreign exchange markets, the currency is said to ________, reflectin...
Brief Principles of Macroeconomics (MindTap Course List)
Define net exports and net capital outflow. Explain how and why they are related.
Principles of Macroeconomics (MindTap Course List)
Is the dept level that maximizes a firms expected EPS the same as the dept level that maximizes its stock price...
Fundamentals of Financial Management (MindTap Course List)
Break-even sales and cost-volume-profit chart For the coming year, Culpeper Products Inc. anticipates a unit se...
Accounting (Text Only)
Direct labor costs During April, Almerinda Company accumulated 20,000 hours of direct labor costs on Job 50 and...
Financial & Managerial Accounting
Which of the following does not affect the bank statement? a. Credit memo b. Debit memo c. Overdraft d. Electro...
College Accounting (Book Only): A Career Approach
How are revenues and expenses reported on the income statement under (a) the cash basis of accounting and (b) t...
Financial Accounting
Say that the bundle of goods purchased by a typical consumer in the base year consisted of 20 gallons of milk a...
Exploring Economics
What are some actions that stockholders can take to ensure that managements and stockholders interests are alig...
Fundamentals of Financial Management, Concise Edition (with Thomson ONE - Business School Edition, 1 term (6 months) Printed Access Card) (MindTap Course List)
A seven-year medical research study reported that women whose mothers took the drug DES during pregnancy were t...
Statistics for Business & Economics, Revised (MindTap Course List)
CHALLENGE PROBLEM This problem challenges you to apply your cumulative accounting knowledge to move a step beyo...
College Accounting, Chapters 1-27 (New in Accounting from Heintz and Parry)
Label each of the following accounts as asset (A), liability (L), owners equity (OE), revenue (R), or expense (...
College Accounting (Book Only): A Career Approach
Does a higher rate of saving lead to higher growth temporarily or indefinitely?
Principles of Macroeconomics (MindTap Course List)
A bond that pays interest forever and has no maturity is a perpetual bond. In what respect is a perpetual bond ...
Fundamentals of Financial Management (MindTap Course List)
Some potential E-business customers have security concerns regarding online purchases. How do Internet security...
Pkg Acc Infor Systems MS VISIO CD
Break-even graph Name the following graph and identify the items represented by the letters (a) through (f).
Survey of Accounting (Accounting I)
Measures of liquidity, solvency, and profitability The comparative financial statements of Marshall Inc. are as...
Corporate Financial Accounting
Use (a) the percentage method and (b) the wage-bracket method to compute the federal income taxes to withhold f...
PAYROLL ACCT.,2019 ED.(LL)-TEXT
In this chapter, we give you the cost of producing a product and other inputs that are used in the analysis. Do...
Practical Management Science
FIFO Method, Two-Department Analysis Refer to the data in Problem 6.38. Required: Prepare a production report f...
Cornerstones of Cost Management (Cornerstones Series)
Some goods are bought largely because they have snob appeal. For example, the residents of Beverly Hills gain p...
Macroeconomics
What does having a positive rate of time preference have to do with positive interest rates?
Economics (MindTap Course List)
Straight line AB in Exhibit A-6 shows that a. increasing values for X decreases the values of Y. b. decreasing ...
Economics For Today
Discuss the reasons why some issues that confront a buyer are often not clear from an ethical perspective.
Purchasing and Supply Chain Management
