Which of the Following Items Would Be Reported Net of Tax

question 16

Multiple Choice

Which of the following items would be reported net of tax on the face of the income statement?

• A) Discontinued operations
• B) Unusual gain
• C) Change in collectability of receivables
• D) Prior period adjustment

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Definitions:

Cash Concentration

The process of consolidating cash from multiple accounts into a single account, aiming to improve the efficiency of cash management and reduce transaction costs.

Centralized Bank Account

A single bank account used by a company to manage and control all payments and receipts, simplifying cash management.

Adjustment Costs

Expenses incurred from making changes to a business, such as restructuring operations or relocating facilities.

Marketable Securities

Short-term financial instruments that can be quickly converted into cash at a reasonable price, like stocks and bonds.