The Gain on Disposal of Trading Securities Is Reported in The

question 64

Multiple Choice

The Gain on Disposal of Trading Securities is reported in the:

• A)other revenues and expenses section of the income statement.
• B)owners' capital section of the income statement.
• C)current assets section of the balance sheet.
• D)fixed assets section of the balance sheet.

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Definitions:

Absorption Costing

An approach in financial accounting that wraps all expenses incurred in manufacturing including direct materials, direct labor, and all overhead (variable and fixed), into the product's cost.

Net Operating Income

The total revenue of a business minus its operating expenses, excluding taxes and interest.

Absorption Costing

An accounting method that includes all manufacturing costs - direct materials, labor, and both variable and fixed overhead - in the cost of a product.

Net Operating Income

An entity’s income after all operating expenses have been deducted from total revenue, excluding taxes and interest charges.