Operating vs. non-operating and recurring vs. nonrecurring are two distinct dimensions of classifying income. Explain this statement and discuss whether or not you agree with it.
Answer to relevant QuestionsWhat conditions are necessary for an item to qualify as a prior period adjustment?List and discuss the factors that affect the fair value of an option.Describe the accounting treatment for discontinued operations. How should an analyst treat discontinued operations?Describe aspects of revenue recognition that an analyst must be especially alert to.Net income computed on the basis of financial reporting often differs from taxable income due to permanent differences. What are permanent differences and how do they arise?
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