If an investment in an associate is sold at a gain, the gain
A)is reported as operating income.
B)is reported under a special section, "Discontinued Investments," on the statement of income.
C)is reported in the Other Income and Gains section on the statement of income.
D)contributes to gross profit on the statement of income.

Question

Quizplus · Accepted Answer

The gain from the sale of an investment in an associate is typically reported in the "Other Income and Gains" section on the statement of income. This is because it is not considered part of the company's primary operating activities but rather a one-time or irregular event.

If an Investment in an Associate Is Sold at a Gain