Comphrensive Income

Question 1

A company reported the following information for Year 1:

Net income $34,000
Owner contribution 9,000
Deferred gain on an effective cash-
flow hedge 8,000
Foreign currency translation gain 2,000
Prior service cost not recognized in
net periodic pension cost 5,000

What is the amount of other comprehensive income for Year 1?

Answer 1

8,000+2,000-5,000= 5,000

HINT: KEYWORD THEY ARE ASKING IS WHAT IS OCI, NOT COMPHRENSIVE INCOME. IF IT IS COMPHRENSIVE INCOME START WITH NET INCOME

TRICK FUCKING QUESTIION WATCH OUT BIATCH!!!!!

Question 2

Palmyra Co. has net income of $11,000, a positive $1,000 net cumulative effect of a change in accounting principle, a $3,000 unrealized loss on available-for-sale securities, a positive $2,000 foreign currency translation adjustment, and a $6,000 increase in its common stock. What amount is Palmyra’s comprehensive income?

A.
$4,000

B.
$10,000

C.
$11,000

D.
$17,000

Answer 2

11,000-3000+2,000=10,000

NOTE:CUM effect of change in accounting principle and increase in C/S have no effect on OCI or comphrensive income

Question 3

With respect to the statement of comprehensive income, what are U.S. GAAP and IFRS differences?

Answer 3

Both U.S. GAAP and IFRS allow a separate statement of comprehensive income or a combined statement.