31. Merchandise inventory is classified as a current asset in a classified statement of financial position.
32. Gain on sale of equipment and interest expense are reported under other income and expense in a merchandiser income statement.
33. If net sales are $800,000 and cost of goods sold is $600,000, the gross profit rate is 25%.
34. Gross profit represents the merchandising profit of a company.
35. Gross profit rate is computed by dividing cost of goods sold by net sales.
36. Under International Financial Reporting Standards (IFRS) operating expenses may be presented by nature or by function.
37. Under International Financial Reporting Standards (IFRS) when operating expenses are presented by nature additional disclosures are required regarding the function of certain expenses.
38. International Financial Reporting Standards allow different presentation formats for operating expenses including by magnitude.
39. IFRS requires companies to mark the recorded values of certain types of assets and liabilities to their historical cost at the end of each reporting period.
40. IFRS requires a single-step income statement, but U.S GAAP allows either the single-step or the multiple-step income statement.