What are the two subtotals that distinguish the multi-step income statement from the single-step income statement?
A) Income before taxes and income taxes
B) Total operating revenues and total operating expenses
C) Income from operations and income before taxes
D) Total revenues and total expenses

Question

Quizplus · Accepted Answer

The two subtotals that distinguish the multi-step income statement from the single-step income statement are income from operations (which is calculated by subtracting total operating expenses from total operating revenues) and income before taxes (which is calculated by subtracting non-operating expenses from income from operations). Options A and D are incorrect because they are simply the final subtotals on the income statement, whereas option B incorrectly describes the subtotals as "total" rather than "operating".

What Are the Two Subtotals That Distinguish the Multi-Step Income