6 66. 67. 68. Ideally. income from continuing operations (as opposed to net Income) is a better income figure to use in projecting future operating financial results. The predominant current asset of a merchandising firm will usually be accounts receivable. The descriptive information in the annual report is not useful in the analysis of the financial statements: only the statements themselves are of value. Other income and other expenses are categories under which secondary activities of the firm not directly related to the operations are classified . The financial statements of legally separate entities may be issued to show the financial position and income as they would appear if the companies were one legal entity. Such statements reflect a legal, rather than an economic, concept of the entity. 69 70