Which one of the following should be NOT reported net of income taxes?
A)Loss on disposal of segment
B)Cumulative adjustments resulting from a change in principle
C)Bad debt expense associated with a bankrupt customer
D)Gains on disposal of segment

Question

Quizplus · Accepted Answer

Bad debt expense associated with a bankrupt customer should not be reported net of income taxes because it is a regular operating expense, not an item that typically requires separate disclosure net of tax in the income statement. Items like losses or gains on disposal of a segment and cumulative adjustments from a change in accounting principle are typically reported net of taxes because they are irregular items that are not part of the ordinary activities of the business.

Which One of the Following Should Be NOT Reported Net