Income Statement Items

Question 1

Formula to determine annual recognized gross profit which requires estimated total gross profit when two years are presented.

Answer 1

Contract price - (estimated total cost (cost to date is multiple yrs are given) + estimated cost to complete) = estimated total costs
700-300-250=150 Yr 1
700-390-130=180 Yr 2

Question 2

Formula to determine completion for year 2

Answer 2

Ratio of costs incurred to date to estimated total cost. 390/520=75%
The calculate the cumulative gross profit. 180*75%=135,000

Then subtract profit recognized in previous yr. 135,000-65,000=70,000

Question 3

Antidilutive clue

Answer 3

If market price (25) is less that exercise price (30)

Question 4

What are the dates to determine a change in foreign currency adjustments

Answer 4

Transaction date
Date change in rate occurred during the period
End of year date

Question 5

Are changes in foreign currency adjustments recognized in OCI

Answer 5

Hell no! It’s reported in the income statement.