Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

4. Merchandising Operations

Comprehensive Income

Financial Accounting

4. Merchandising Operations

Comprehensive Income

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Multiple Choice

Which of the following is NOT included in continuing operations when preparing a company's statement of comprehensive income?

Unrealized gains and losses on available-for-sale securities

Operating expenses

Cost of goods sold

Sales revenue from primary business activities

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Verified step by step guidance

Understand the concept of 'continuing operations': Continuing operations refer to the core business activities of a company that are expected to continue in the foreseeable future. These include revenues, expenses, and costs directly related to the primary business operations.

Review the components of continuing operations: These typically include sales revenue from primary business activities, cost of goods sold (COGS), and operating expenses. These items are directly tied to the company's ongoing business activities.

Identify unrealized gains and losses on available-for-sale securities: Unrealized gains and losses arise from changes in the fair value of investments that have not yet been sold. These are classified as 'other comprehensive income' and are not part of continuing operations because they are not directly related to the company's core business activities.

Compare the options provided: Sales revenue, operating expenses, and cost of goods sold are all part of continuing operations because they are directly tied to the company's primary business activities. Unrealized gains and losses on available-for-sale securities are excluded because they are part of other comprehensive income.

Conclude that unrealized gains and losses on available-for-sale securities are NOT included in continuing operations when preparing a company's statement of comprehensive income.