21) Which of the following is considered to be a limitation A) Income statements depend on accounting meth B) Income statements evaluate past performance C) Income statement D) Income statements predict future performance s assess uncertainties of achieving future cash flows. 22) Which of the operations? A) revenue B) comprehensive income C) gain D) net income owing income statement elements is an economic inflow that occurs from primary statement 23) Which of the following transactions will most likely result in a loss reported on the income statement? A) A shoe store acquires a large supply of shoe polish fro m a supplier going through bankruptcy 6) A manufacturer pays a company a fee to license that company's proprietary C) A bank pays more interest than expected on customers savings accounts D) A grocery store sells marketable securities after a decline in value. 24) Which of the following is not a subtotal on the multi-step income statem A) income from discontinued operations B) gross profit C) operating income D) income before tax ent? 25) Which of the multi-step income statement reports revenues and expenses related to secondary operations of the entity? A) discontinued operations section B) other comprehensive income C) non-operating section D) operating section 26) On the income statement, the line item that comes before income tax expense is call continuing operations A) True B) False ed income from business activity is a component of an entity for purposes of classifying that activity as a discontinued operation? 27) Which of the following is not a characteristic that must be considered when determining that a A) The activity comprises operations and cash flows. B) The activity constitutes a strategic advantage. C) The activity can be clearly distinguished for financial reporting purposes. D) The activity is a portion of the entity