1)Comprehensive income consists of net income + other adjustments to retained earnings O operating income + other income and losses O net income other comprehensive income o other comprehensive income + unrealized changes in the value of available for sale securities 2)Activities between affiliated entities, such as a company and its management, must be disclosed in the financial statements of a corporation as O significant relationships O segment analysis O related party transactions O contingent activities

1)

Comprehensive income for a company is the combination of the following amounts which occurred during a specified period of time such as a year, quarter, month, etc.:, depending on the period of calculation.

Net income or net loss which are reported on the corporation's income statement), added with other comprehensive income.

Other comprehensive income include like the following:-

1.Unrealized gains/losses on hedging derivatives

2.Foreign currency translation adjustments

3.Unrealized gains/losses on postretirement benefit plans

Basically, comprehensive income consists of all of the revenues, gains, expenses, and losses that caused stockholders' equity to change during the accounting period.

Option C is the correct answer as it clearly states comphrensive income includes net income and other comprehensive income. Other options are incorrect.

2)

Solution is Option 3: Related party transactions

Activities between affiliated entities, such as company and its management, must be disclosed in the financial statements of a corporation as related party transactions.

Companies generally have transactions with familiar person be it the director, its subsidiary or associate companies. Related party transactions needs to be separately disclosed in the notes to financial statements because such transactions can be misused for fraud/misrepresentations/misappropriations etc.