Income Statement and Related Information DONALD E.KIESO·JERRY J.WEYGANDT TERRY D.WARFIELDII I Intermediate Chapter 4 Accounting EDITION Intermediate Accounting 12th Edition Kieso,Weygandt,and Warfield : www Chapter 4-1
Chapter 4-1 Intermediate Accounting 12th Edition Kieso, Weygandt, and Warfield
Learning Objectives 1.Understand the uses and limitations of an income statement. 2.Prepare a single-step income statement. 3.Prepare a multiple-step income statement. 4.Explain how to report irregular items. 5.Explain intraperiod tax allocation. 6.Identify where to report earnings per share information. 7.Prepare a retained earnings statement. 8.Explain how to report other comprehensive income. Chapter 4-2
Chapter 4-2
Income Statement and Related Information Format of the Special Income Reporting Income Statement Reporting Irregular Items Statement Issues Usefulness Elements 0 Discontinued Intraperiod tax Limitations Single-step operations allocation Quality of Earnings 0 Multiple-step 0 Extraordinary items Earnings per share Condensed income 0 Unusual gains and 0 Retained earnings statements losses statement 0 Changes in Comprehensive accounting income principles 0 Changes in estimates Corrections of errors Chapter 4-3
Chapter 4-3
Income Statement Usefulness of the Income Statement Evaluate past performance. Predicting future performance. Help assess the risk or uncertainty of achieving future cash flows. Chapter 4-4 LO 1 Understand the uses and limitations of an income statement
Chapter 4-4 Evaluate past performance. Predicting future performance. Help assess the risk or uncertainty of achieving future cash flows. Usefulness of the Income Statement
Income Statement Limitations of the Income Statement Companies omit items that cannot be measured reliably. Income is affected by the accounting methods employed. Income measurement involves judgment. Chapter 4-5 LO 1 Understand the uses and limitations of an income statement
Chapter 4-5 Companies omit items that cannot be measured reliably. Income is affected by the accounting methods employed. Income measurement involves judgment. Limitations of the Income Statement