Question: Firms often enter into transactions that are peripheral to their core operations but generate gains and losses that must be reported on the income statement.

Firms often enter into transactions that are peripheral to their core operations but generate gains and losses that must be reported on the income statement. A gain labeled “peripheral” by one firm may not be labeled as such for another firm. Provide an example in which a gain generated from the sale of an equity security may be labeled a peripheral activity by one firm but is considered a core activity by another firm.

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