Chapter 1 Section 2: Income Statement

Question 1

What is the presentation order of the major components of income and retained earnings?

IDEA

What is net of tax?
What is on the income statement and what is on retained earnings?

Answer 1

Income Statement:
Income from continuing operations - gross of tax
Income from discontinued operations - net of tax
Extraordinary items - net of tax
Retained Earnings:
Cumulative effect of change in accounting principle - net of tax