Exam FAR Topic 1 Question 137 Discussion

Actual exam question for AICPA's FAR exam
Question #: 137
Topic #: 1
A transaction that is unusual in nature and infrequent in occurrence should be reported separately as a
component of income:

Suggested Answer: D Vote an answer

Choice "d" is correct. An extraordinary item (a transaction that is both "unusual in nature" and "infrequent
in occurrence") should be reported separately as a component of income after discontinued operations of
a segment of a business.
The cumulative effect of a change in accounting principle is shown on the retained earnings statement.
This is why memorizing the mnemonic "idea" is so important.

by Riva at Apr 28, 2025, 09:53 PM

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