F1.7 Statement of Comprehensive Income

Question 1

Net Income

Answer 1

Revenue - op. expenses - income tax exp. NI includes income from continuing operations (op., non-op., and income tax exp. If using multiple-step format) and discontinued operations. Q1, foreign currency translation adj. is OCI, not NI.

Question 2

Comphrehensive Income

Answer 2

change in equity of a business during a period from transactions and other events and circumstances from non-owner sources. Includes all changes in equity except those resulting from investments by owners and distributions to owners. Yes to loss on discont. ops. and NO to investment by owners. / Formula: NI + OCI = CI / q5, accumulated OCI is reported in stockholder’s equity section of BS. / q8 No to must be shown on face of IS and Yes to related tax effects from components must be disclosed. CI may be shown on face of combined “statement of income and CI” as a separate section below net income or a separate “statement of comprehensive income”. Income tax exp. or benefit allocated to components must be disclosed, either on face of the stmt or in notes to the stmt. / q10 CI reported to summarize all changes in equity from nonowner sources

Question 3

NOT classified as OCI

Answer 3

Gains from extinguishment of debt, it’s a component of NI. OCI includes changes in funded status of pension plan, unrealized gains and losses on AFS, foreign currency items, and effective of portion of cash flow hedge /q7 detailed definition of OCI (PUFER) / q17 prior service cost not recognized in net periodic pension cost (subtract from OCI).

Question 4

Reclassification adj. must be shown in FS that discloses CI:

Answer 4

To avoid double counting in CI items, which are currently displayed in net income.

Question 5

CI excludes changes in equity from:

Answer 5

Dividends paid to stockholders. CI includes all changes in equity during a period except those resulting from owner investments and distribution to owners

Question 6

Accumulated other comprehensive is reported on

Answer 6

Statement of financial position. AOCI is on BS and reported on statement of financial position / q19 AOCI includes prior service costs not previously recognized as a component of net periodic pension costs.

Question 7

Item not found in CI

Answer 7

non-monetary exchanges of common stock for productive assets.