Answer as TRUE or FALSE 2. Revenue is recognized in the period it is earned, which may or may not be in the same period as the related cash collection. 3. Depreciation is a special type of expense that helps improve profitability of the company 4. Under both IFRS and US GAAP, the income statement reports separately the effect of the disposal of a component operation as a "discontinued" operation. 5. If a company has a simple capital structure (i.e., one with no potentially dilutive securities), then its basic EPS is equal to its diluted EPS. If, however, a company has dilutive securities, its diluted EPS is lower than its basic EPS.