Final answer:
Comprehensive income is the change in a company's equity, excluding transactions from owners, such as investments and dividends, and reflects the company's financial health to shareholders and potential investors.
Step-by-step explanation:
The change in equity of a business enterprise during a period from transactions and other events and circumstances from nonowner sources is often termed as comprehensive income. This includes all changes in equity during a certain period except those resulting from investments by owners and distributions to owners, such as issuing shares of stock in the company or paying dividends. Equity reflects the remaining value to shareholders after all liabilities have been accounted for, and it can be affected by profits retained in the company, losses, or comprehensive income thus, it is crucial for shareholders and potential investors who are monitoring a company's financial health.