The Nonoperating Items That Appear on the Income Statement Include

question 54

Multiple Choice

The nonoperating items that appear on the income statement include

• A) discontinued operations.
• B) gains or losses on the sale or disposal of these segments.
• C) both discontinued operations and gains or losses on the sale or disposal of these segments.
• D) neither discontinued operations nor gains or losses on the sale or disposal of these segments.

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Definitions:

Raw Materials

The basic, unprocessed inputs used in manufacturing to produce finished goods.

Accounts Payable

Amounts owed to creditors that result from the purchase of goods or services on account—a liability.

Source Documents

Documents that provide evidence of a business's transactions, such as invoices, contracts, or receipts.

General Journal Entries

The records of financial transactions in the chronological order in which they occur, used as a preliminary step in building the company's financial statements.