Given below are several items that will be reported on a company's financial statements.Select the letter of the proper financial statement reporting section listed as a through f.You may use each letter more than once or not at all.
-A large loss of inventory incurred by a meat-packing factory due to a government FDA inspection which found dangerously high levels of bacteria; no previous situations in the company's history
A) Income from continuing operations section of the income statement
B) Discontinued operations section of the income statement
C) Extraordinary items section of the income statement
D) Cumulative effect of a change in accounting principle section of the income statement
E) A separate comprehensive income item
F) Not reported on the income statement or comprehensive income statement

Question

Quizplus · Accepted Answer

The large loss of inventory due to a government FDA inspection would be reported in the income from continuing operations section of the income statement because it relates to the core operations of the company and does not fit the criteria for discontinued operations, extraordinary items, a change in accounting principle, or items not reported on the income statement.

Given Below Are Several Items That Will Be Reported on a Company's