Which One of the Following Types of Losses Is Excluded

question 139

Multiple Choice

Which one of the following types of losses is excluded from the determination of net income in income statements?

• A) Material losses resulting from transactions in the company's investments account.
• B) Material losses resulting from unusual sales of assets not acquired for resale.
• C) Material losses resulting from the write-off of intangibles.
• D) Material losses resulting from correction of errors related to prior periods.

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Definitions:

Other Comprehensive Income

Other comprehensive income includes revenues, expenses, gains, and losses that are not included in net income and are reported in the equity section of the balance sheet.

Unrealized Gains

Increases in the value of an investment that have not been sold or exchanged for cash, thus not realized as income.

Management Evaluation

The process of assessing and reviewing the performance, skills, and effectiveness of managers within an organization.

Debt Investments

Investments made by purchasing bonds or other debt instruments, typically generating income from interest payments.