The distinction between operating and nonoperating income relates to:
A) continuity of income.
B) primary activities of the reporting entity.
C) consistency of income stream.
D) reliability of measurements.

Question

Quizplus · Accepted Answer

The distinction between operating and nonoperating income is based on the primary activities of the reporting entity. Operating income is generated from the entity's primary business activities, while nonoperating income is generated from secondary or peripheral activities. Therefore, B is the best choice.

The Distinction Between Operating and Nonoperating Income Relates To