When reporting unusual or infrequent items in the income statement which of the following is not correct?

Multiple Choice

• If a material event is either unusual in nature or an infrequent occurrence it is classified on the income statement as a special or unusual item in continuing operations.

• If a material event is either unusual in nature or an infrequent occurrencesuch as a one-time charge resulting from a major restructuringit may be classified on the income statement as a special or unusual item in continuing operations or treated as an extraordinary item if it has been a number of years since the companys last major restructuring.

• Firms that use early debt retirement will report the associated gains and losses as part of income from continuing operations with separate line-item disclosure.

• The write-off of obsolete inventory would be reported on the income statement as a special item in continuing operations.