Final answer:
The false statement about comprehensive income is that it includes changes resulting from investments by stockholders. Comprehensive income includes all changes in equity except those from equity transactions, like investments by owners and distributions to owners. It requires unrealized gains and losses to be included and does not include dividends.
Step-by-step explanation:
The subject of this question is comprehensive income. The statement that is false regarding comprehensive income is that comprehensive income includes changes resulting from investments by stockholders. In fact, comprehensive income does not include these changes; rather, it includes all changes in equity during a period except those resulting from investments by owners and distributions to owners. Investments by stockholders are part of the equity transactions and not included in comprehensive income. Comprehensive income does include items such as unrealized gains and losses on available-for-sale securities, which would be added or subtracted from net income to calculate comprehensive income. It is required by accounting standards for companies to report comprehensive income to better reflect a company’s overall financial performance. Comprehensive income also excludes dividends to stockholders since dividends are treated as a distribution of profits rather than income.