Which of the Following Costs Is Most Likely to Be

question 47

Multiple Choice

Which of the following costs is most likely to be the largest expense reported on the income statement of a merchandiser such as Wal-Mart stores?

• A) Utilities expense.
• B) Cost of goods sold.
• C)Advertising expense.
• D)Income tax expense.

---

Definitions:

Expected Rate

The predicted average rate of return or growth over a specific period of time.

Total Investment

The sum of expenditures on capital assets, plus the change in inventory levels, within an economy over a period of time.

Market Rate

The prevailing price or interest rate available in the marketplace for goods, services, or financial assets.

Interest

Interest is the cost of borrowing money, typically expressed as a percent of the amount borrowed, paid by the borrower to the lender.