Professional research : FASB Codification

Topics: Income statement, Generally Accepted Accounting Principles, Income, Revenue / Pages: 4 (823 words) / Published: Dec 2nd, 2013
Problem2# Professional research Acct2241 (a) What authoritative literature addresses comprehensive income? When was issued?
The FASB Accounting Standards Codification® is the source of authoritative generally accepted accounting principles (GAAP) recognized by the FASB to be applied by nongovernmental entities.
Statement of Financial Accounting Standards No. 130
Reporting Comprehensive Income
Issued: June 1997

(b) Provide the definition of comprehensive income
Comprehensive income is defined in Concepts Statement 6 as “the change in equity [net assets] of a business enterprise during a period from transactions and other events and circumstances from nonowner sources. It includes all changes in equity during a period except those resulting from investments by owners and distributions to owners”(paragraph 70).
In Concepts Statement 5, the Board stated that “a full set of financial statements for a period should show: Financial position at the end of the period, earnings (net income) for the period, comprehensive income (total nonowner changes in equity) for the period, cash flows during the period, and investments by and distributions to owners during the period” (paragraph13, footnote references omitted). Prior to issuance of this Statement, the Board had neither required that an enterprise report comprehensive income, nor had it recommended a format for displaying comprehensive income

(c) Define classifications within net income and give example.
A measure of financial performance resulting from the aggregation of revenues, expenses, gains, and losses that are not items of other comprehensive income. A variety of other terms such as net earnings or earnings may be used to describe net income.
Items included in net income

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