Using the Absorption Method,the Gross Profit on Sales Is

question 92

Multiple Choice

Using the absorption method,the gross profit on sales is:

• A) $550,000
• B) $540,000
• C) $480,000
• D) $450,000

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Definitions:

WorldCom

A former American telecommunications company that became infamous for its massive accounting scandal, leading to its bankruptcy in 2002.

Enron

An American energy company known for one of the largest cases of corporate fraud and bankruptcy in history.

Sarbanes-Oxley Act

A U.S. law enacted in 2002 to protect investors by improving the accuracy and reliability of corporate disclosures.

Financial Reporting

The method of generating reports that reveal the financial condition of an organization to its management, investors, and governmental authorities.