The Essence of Nonrecurring Items on an Income Statement Is

question 2

True/False

The essence of nonrecurring items on an income statement is that they are not useful in predicting the future income of the reporting company.

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Definitions:

Commitments

Commitments are potential liabilities or obligations that a company has legally agreed to fulfill in the future, such as contracts for goods or services that have not yet been delivered or paid for.

Governmental Fund Financial Statements

Financial reports that detail the financial position and results of operations for the governmental funds of a public entity.

Modified Accrual

An accounting method that combines elements of both cash and accrual accounting, recognizing revenues when they become available and measurable and expenses when incurred.

Capital Assets

Long-term assets such as buildings, land, or equipment, which are used in the operations of a business and are not intended for sale in the regular course of business.