Additional facts are as follows. “Selling, general, and administrative expenses” for 2014 included a charge of $11,000,000 that was usual but infrequently occurring. “Other, net” for 2014 included an...

Additional facts are as follows.

1. 
   

   “Selling, general, and administrative expenses” for 2014 included a charge of $11,000,000 that was usual but infrequently occurring.

   
   


2. 
   

   “Other, net” for 2014 included an extraordinary item (gain) of $8,500,000. If the extraordinary item (charge) had not occurred, income taxes for 2014 would have been $40,200,000 instead of $43,400,000.

   
   


3. 
   

   “Adjustment required for correction of an error” was a result of a change in estimate (useful life of

   
   

   certain assets reduced to 8 years and a catch-up adjustment made).

   
   


4. 
   

   OFD Company disclosed earnings per common share for net income in the notes to the financial

   
   

   statements.

   
   

Instructions

Determine from these additional facts whether the presentation of the facts in the OFD Company income and retained earnings statement is appropriate. If the presentation is not appropriate, describe the appro- priate presentation and discuss its theoretical rationale. (Do not prepare a revised statement.)