Which of the Following Items Would Be Reported at Its

question 98

Multiple Choice

Which of the following items would be reported at its gross amount on the face of the income statement?

• A) Extraordinary loss
• B) Prior period adjustment
• C) Cumulative effect of a change in an accounting principle
• D) Unusual gain

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Definitions:

Discount on Bonds Payable

The difference between the face value of bonds and their selling price, when the bonds are sold for less than their face value.

Redeems

The act of exchanging something such as coupons, vouchers, or securities for goods, services, or money.

Gain

Financial benefit realized from activities such as the sale of an asset for more than its original purchase price.

Loss

A financial condition indicating that expenses have exceeded revenues, leading to a negative income.