Chapter 2: Financial Statements Flashcards
Are unrealized holding gains on available-for-sale debt securities included in comprehensive income?
Yes.
What is the order of presentation for the income statement?
- Income from continuing operations.
- Discontinued operations.
Where should a loss/gain from an unusual transaction be presented?
Before the results of discontinued operations.
What is other comprehensive income (OCI)? And what does OCI include?
Other comprehensive income includes all comprehensive income that is not included in net income. This includes gains and losses on derivatives designated and qualifying as cash flow hedges; foreign currency translations gains and losses; and unrealized holding loss on available-for-sale debt securities.
What FS is accumulated other comprehensive income reported on?
The statement of financial position. (Income Statement)
What must be reported by both defined contribution and defined benefit pension plan?
A statement of changes in net assets available for benefits.
What effects should the statement of changes in net assets available for benefits present?
- Net appreciation or depreciation of the fair value of investments.
- Contributions from employers, separately cash and noncash contributions.
- Contributions from participants or other identified sources.
- Benefits paid to participants.
- Administrative expenses.
- Payments to insurance entities to purchase contracts that are excluded from plan assets.
A company pays more than the fair value to acquire treasury stock. The difference between the price paid to acquire the treasury stock and the fair value should be recorded as
Shareholders’ equity
What does the net appreciation or depreciation of the fair value of investments include?
(a) changes in the fair value of investments that were both purchased and sold during the period and (b) unrealized appreciation or depreciation of the investments held at year-end.
