Question

Answer the questions: True or False

PLEASE NEED HELP ASAP

5. The major elements of the income statement are revenues, irregular items, and general expenses. (T/F)

6. The income statement reveals net earnings (net income) of a firm at a point in time. (T/F)

7. The gain or loss on disposal of a segment or component of the business should be reported as an unusual gain or loss. (T/F)

8. When a company discontinues an operation and disposes of the discontinued operation (component), the transaction should be included in the income statement as a gain or loss on disposal reported as an extraordinary item. (T/F)

9. Changes in estimates are not carried back to adjust prior years, but rather are dealt with currently and prospectively. (T/F)

10. A change in accounting principle requires that the cumulative effect of the change for prior periods be shown as an adjustment to stockholders’ equity of the period in which the change occurred. (T/F)

Answer 1

5)

False- The major elements of the income statement are revenues, irregular items, and general expenses.

since the major element of income statement are revenue ,cost of goods sold and other operating epenses.

6)

False - The income statement reveals net earnings (net income) of a firm at pointd in time.

since-It reveals net earning of a firm at periodof time.2019.04.01 to 2019.03.31)

7)

False-The gain or loss on disposal of a segment or component of the business should be be reported as an unusual gain or loss.

since it is organisation principle revenue generating activities.

8) TRUE-When a company discontinues an operation and disposes of the discontinued operation (component), the transaction should be included in the income statement as a gain or loss on disposal reported as an extraordinary item.

Since it is treated as dfferent from normal cource of operation .

9)True-change in estimates are not carried back to adjust prior years, but rather are dealt with currently and prospectively.

since -Accounting estimate is based on current situtation and position rather than the previous estimate.

For ex.Doubtful debt increase by RS.1000 from last year should not be adjusted to the last year ,but should be dealed currently.

10)True-A change in accounting principle requires that the cumulative effect of the change for prior periods be shown as an adjustment to stockholders’ equity of the period in which the change occurred.

Since-prior period item refers to the item which have been not recorded or mistakely recorded in previous years. so the actual consideration should be adjusted to shareholders equity of the period in which the change occured.

Thanks...