When Looking at the Statement of Comprehensive Income in the 2009

question 9

Multiple Choice

When looking at the statement of comprehensive income in the 2009 annual reports of four similar companies in the same industry, you find the following: Which company has an expense item that is likely to be persistent in terms of earnings?

• A) Company 1
• B) Company 2
• C) Company 3
• D) Company 4 Solution C, because items that are expected to be persistent in terms of earning are those transactions like research and development costs, that are expected to be repeated in future years during the normal operation of the business. The other items, like a charge for disposal of a business segment, a provision for restructuring, and litigation charges, are all items that are not expected to occur again in future years.

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Definitions:

Safety Violations

Instances where safety regulations and standards are not followed, risking the health and safety of individuals.

Facility Supervisor

An individual responsible for overseeing the day-to-day operations, maintenance, and security of buildings, grounds, and facilities to ensure they meet the necessary standards and regulations.

Bureau of Labor Statistics

A U.S. government agency responsible for collecting and analyzing economic data related to labor market activity, working conditions, and price changes.

Human Resource Policies

Guidelines and protocols established by an organization to manage its employees, covering aspects like recruitment, discipline, compensation, and benefits.