incomestatementandrelatedinformation(编辑修改稿)

incomestatementandrelatedinformation(编辑修改稿)内容摘要：

vities. Extraordinary Item must be both of an  Unusual Nature and  Occur Infrequently Company must consider the environment in which it operates. Amount reported “ of tax.” Reporting Irregular Items LO 4 Explain how to report irregular items. 425 Are these items Extraordinary? (a) A large portion of a tobacco manufacturer‟s crops are destroyed by a hail storm. Severe damage from hail storms in the locality where the manufacturer grows tobacco is rare. (b) A citrus grower39。 s Florida crop is damaged by frost. (c) A pany sells a block of mon stock of a publicly traded pany. The block of shares, which represents less than 10% of the publiclyheld pany, is the only security investment the pany has ever owned. YES Reporting Extraordinary Items NO YES LO 4 Explain how to report irregular items. 426 Are these items Extraordinary? (d) A large diversified pany sells a block of shares from its portfolio of securities which it has acquired for investment purposes. This is the first sale from its portfolio of securities. (e) An earthquake destroys one of the oil refineries owned by a large multinational oil pany. Earthquakes are rare in this geographical location. (f) A pany experiences a material loss in the repurchase of a large bond issue that has been outstanding for 3 years. The pany regularly repurchases bonds of this nature. NO Reporting Extraordinary Items YES NO LO 4 427 Illustration: KC Corporation had after tax ine from continuing operations of $55,000,000 during the year. In addition, it suffered an unusual and infrequent pretax loss of $770,000 from a volcano eruption. The corporation‟s tax rate is 30%. Prepare a partial ine statement for KC Corporation beginning with ine from continuing operations. Ine from continuing operations $55,000,000 Extraordinary loss, of $231,000 tax 539,000 Net ine $54,461,000 Reporting Extraordinary Items ($770,000 x 30% = $231,000 tax) LO 4 Explain how to report irregular items. 428 Extraordinary Items are reported after “Ine from continuing operations.” LO 4 O t h e r r e v e n u e ( e x p e n s e ) :I n t e r e s t r e v e n u e 1 7 , 0 0 0 I n t e r e s t e x p e n s e ( 2 1 , 0 0 0 ) T o t a l o t h e r ( 4 , 0 0 0 ) I n c o m e b e f o r e t a x e s 7 9 , 0 0 0 I n c o m e t a x e x p e n s e 2 4 , 0 0 0 I n c o m e f r o m c o n t i n u i n g o p e r a t i o n s 5 5 , 0 0 0 E x t r a o r d i n a r y l o s s , n e t o f t a x 539 N e t i n c o m e 5 4 , 4 6 1$ I n c o me S t a t e me n t ( i n t h o u s a n d s )S a l e s 2 8 5 , 0 0 0$ C o s t o f g o o d s s o l d 1 4 9 , 0 0 0 G r o s s p r o f i t 1 3 6 , 0 0 0 Previously labeled as “Net Ine”. Moved to Reporting Extraordinary Items 429 LO 4 Illustration 48 Ine Statement Presentation of Extraordinary Items Reporting Extraordinary Items 430 Reporting when both Discontinued Operations and Extraordinary Items are present. Discontinued Operations LO 4 I n c o m e b e f o r e t a x e s 7 9 , 0 0 0 I n c o m e t a x e x p e n s e 2 4 , 0 0 0 I n c o m e f r o m c o n t i n u i n g o p e r a t i o n s 5 5 , 0 0 0 D i s c o n t i n u e d o p e r a t i o n s :L o s s f r o m o p e r a t i o n s , n e t o f t a x 315 L o s s o n d i s p o s a l , n e t o f t a x 189 T o t a l l o s s o n d i s c o n t i n u e d o p e r a t i o n s 504 I n c o m e b e f o r e e x t r a o r d i n a r y i t e m 5 4 , 4 9 6 E x t r a o r d i n a r y l o s s , n e t o f t a x 539 N e t i n c o m e 5 4 , 4 9 6$ I n c o me S t a t e me n t ( i n t h o u s a n d s )S a l e s 2 8 5 , 0 0 0$ C o s t o f g o o d s s o l d 1 4 9 , 0 0 0 G r o s s p r o f i t 1 3 6 , 0 0 0 Extraordinary Items Reporting Irregular Items 431 Irregular transactions such as discontinued operations and extraordinary items should be reported separately in a. both a singlestep and multiplestep ine statement. b. a singlestep ine statement only. c. a multiplestep ine statement only. d. neither a singlestep nor a multiplestep ine statement. Review LO 4 Explain how to report irregular items. Reporting Irregular Items 432 Material items that are unusual or infrequent, but not both, should be reported in a separate section just above “Ine from continuing operations before ine taxes.” Examples can include:  Writedowns of inventories  Foreign exchange transaction gains and losses The Board prohibits oftax treatment for these items. Reporting Irregular Items LO 4 Explain how to report irregular items. Unusual Gains and Losses 433 Reporting Irregular Items LO 4 Explain how to report irregular items. Illustration 49 Ine Statement Presentation of Unusual Charges Unusual Gains and Losses 434  Retrospective adjustment.  Cumulative effect adjustment to beginning retained earnings.  Approach preserves parability.  Examples include: ► change from FIFO to average cost. ► change from the percentageofpletion to the pletedcontract method. Reporting Irregular Items LO 4 Explain how to report irregular items. Changes in Accounting Principles 435 Reporting Irregular Items LO 4 Explain how to report irregular items. Change in Accounting Principle: Gaubert Inc. decided in March 2020 to change from FIFO to weightedaverage inventory pricing. Gaubert‟s ine before taxes, using the new weightedaverage method in 2020, is $30,000. Illustration 410 Calculation of a Change in Accounting Principle Illustration 411 Ine Statement Presentation of a Change in Accounting Principle (Ba。