Which of the following statements regarding limitations of the income statement is not true?
A)The net income amount includes estimated expenses that are subject to change.
B)Numerous available accounting methods may cause a lack of comparability.
C)Rigid accounting rules may lead to distorted earnings amounts.
D)The current income statement allows several income items to be directly put on the retained earnings statement.

Question

Quizplus · Accepted Answer

The current income statement does not allow income items to be directly put on the retained earnings statement. Rather, the net income is transferred from the income statement to the retained earnings statement.

Which of the Following Statements Regarding Limitations of the Income