The Purpose of Developing the Subtotal "Income from Continuing Operations

question 127

Multiple Choice

The purpose of developing the subtotal "Income from Continuing Operations" in an income statement is to:

• A)Assist investors in forecasting future operating results.
• B)Increase the amount of reported net income.
• C)Decrease the amount of income subject to income taxes.
• D)Provide investors with the information necessary to compute earnings per share.

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Definitions:

Semi-annual Payments

Payments made twice a year, a common term in the context of loans, bonds, and some types of annuities.

Loan

Funds lent that must be repaid with an added interest charge.

Ordinary Annuity

A series of equal payments made at regular intervals over a specified period of time, with the first payment made at the end of the period.

End-of-month Deposits

Payments or contributions made into an account, financial product, or investment fund at the conclusion of each month.