Which of the Following Transactions Will Not Decrease the Net

question 45

Multiple Choice

Which of the following transactions will not decrease the net profit margin ratio?

• A) Accruing interest expense at year-end.
• B) The recording of depreciation expense.
• C)Using cash to pay for previously accrued salaries.
• D)Accruing utilities expense at year-enD.Net profit margin = Net income ÷ Net sales (operating revenues). Previously accrued expenses have already been recognized and factored into net income; paying for these expenses impacts the balance sheet and not the income statement.

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