CFA Practice Question

There are 534 practice questions for this study session.

CFA Practice Question

Gains or losses from extraordinary items should be shown on the income statement ______.
A. immediately following income from continuing operations
B. after discontinued operations
C. as an item in other revenues and expenses
Explanation: Discontinued operations are shown immediately following income from continued operations. Gains or losses from extraordinary items should be shown on the income statement after discontinued operations. This is a pre-2015 requirement. After 2015 companies are no longer required to evaluate the income tax effect of extraordinary items and present an EPS effect.

User Contributed Comments 7

User Comment
Nicholas is this right?
xjarl It's correct, see p49 & 50 in volume 3 of the curriculum. After Net income from continued operations you have:

1. Discontinued operations.
2. Extraordinary items.
3. Effect of accounting changes.
anaraguin CDE
continued
Discontinued
Extraordinary (gains/losses)
swallow2585 IDEA
mickykumar Note IFRS does not permit extraordinary items so this question applies to US GAAP only.
philerup CDE is a good acronym for remembering, thanks.
kingirm After 2015 US GAAP no longer allows items to be treated as extraordinary.
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