Based on GAAP, which of the following is true of comprehensive income?
A)It should be reported as part of sales in the income statement.
B)It can be reported as part of statement of shareholders' equity.
C)It should be reported as a line item before earnings after tax in the balance sheet.
D)It should be reported as part of operating activities in the statement of cash flows.

Question

Quizplus · Accepted Answer

According to GAAP, comprehensive income should be reported as part of the statement of shareholders' equity. It includes all changes in equity during a certain period of time, including net income, unrealized gains or losses on investments, foreign currency translation adjustments, and other comprehensive income items. It is not reported as part of sales in the income statement, as a line item before earnings after tax in the balance sheet, or as part of operating activities in the statement of cash flows.

Based on GAAP, Which of the Following Is True of Comprehensive