Answer
Problems arise in issues relating to the reporting of unusual items, such as one-time losses arising from the disposal of investments. Besides, problems arise on where specifically the unusual items ought to be reported. Supporters of The "current operating performance approach" argue that only recurrent items should be included in the income report. This view is problematic because it leaves out material details regarding a company's actual performance. The "modified all-inclusive Concept" offers a practical alternative that has been endorsed by the accounting profession. The concept allows for the usual items to be included as components of net income.
Work Step by Step
Problems arise in issues relating to the reporting of unusual items, such as one-time losses arising from the disposal of investments. Besides, problems arise on where specifically the unusual items ought to be reported. Supporters of The "current operating performance approach" argue that only recurrent items should be included in the income report. This view is problematic because it leaves out material details regarding a company's actual performance. The "modified all-inclusive Concept" offers a practical alternative that has been endorsed by the accounting profession. The concept allows for the usual items to be included as components of net income.
