Which of the following is an example of Other Comprehensive Income?

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Multiple Choice

Which of the following is an example of Other Comprehensive Income?

Other Comprehensive Income includes items that affect equity but aren’t part of net income. An unrealized gain or loss on investments in equity instruments measured at fair value through OCI is exactly the kind of item that goes straight to OCI, not through the profit-and-loss line. It reflects changes in the value of the investment that haven’t been realized by selling the asset, so they’re recorded in OCI. The other options are typical P&L items: a realized gain from selling equipment appears in net income when the sale occurs; interest income from bank deposits is revenue recognized in net income; dividends received are also generally recognized in net income.

Other Comprehensive Income includes items that affect equity but aren’t part of net income. An unrealized gain or loss on investments in equity instruments measured at fair value through OCI is exactly the kind of item that goes straight to OCI, not through the profit-and-loss line. It reflects changes in the value of the investment that haven’t been realized by selling the asset, so they’re recorded in OCI.

The other options are typical P&L items: a realized gain from selling equipment appears in net income when the sale occurs; interest income from bank deposits is revenue recognized in net income; dividends received are also generally recognized in net income.

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