Question

[7] Palmyra Co. has net income of $11,000, a positive $1,000 net cumulative effect of a change in accounting principle, a $3,000 unrealized loss on available-for-sale debt securities, a positive $2,000 foreign currency translation adjustment, and a $6,000 increase in its common stock. What amount is Palmyra’s comprehensive income? A. $4,000 B. $10,000 C. $11,000 D. $17,000

Answer 1

option B

Step-by-step explanation:

the correct answer is option B

comprehensive income is calculated as net income less than the unrealized loss plus the positive foreign currency translation adjustment

comprehensive income = $11,000 - $3000 + $2000

= $ 10,000

In comprehensive income, we do not include a positive $1,000 net cumulative effect and also $6,000 increase in its common stock.