Which statement is true concerning gains and losses?
A)Gains and losses are reported on the balance sheet in the Assets and Liabilities sections, respectively.
B)Gains and losses are special types of revenues and expenses that are reported on the income statement.
C)The amounts of gains and losses are included in the calculation of the current ratio, in the numerator and denominator, respectively.
D)Gains and losses are reported only on a multi-step income statement.

Question

Quizplus · Accepted Answer

Gains and losses are special types of revenues and expenses that are reported on the income statement. They are not reported on the balance sheet, and while they may impact the calculation of ratios, they are not included in the numerator or denominator of any specific ratio. Gains and losses are reported on both single-step and multi-step income statements.

Which Statement Is True Concerning Gains and Losses