If a Company Uses a Multiple-Column Purchases Journal, Which of the Following

question 11

Multiple Choice

If a company uses a multiple-column purchases journal, which of the following possible headings for debit columns of the journal would not be appropriate?

• A)Accounts Payable
• B)Merchandise Inventory
• C)Store Supplies
• D)Office Supplies

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Definitions:

Net Operating Income

A measure of a company's profitability from its regular, core business operations, excluding deductions of interest and taxes.

Contribution Margin Ratio

The percentage of each sale that remains after variable costs are deducted, indicating how much revenue is contributing to fixed costs and profit.

Operating Leverage

A measure of how sensitive a company's operating income is to a change in sales, reflecting the proportion of fixed costs in the company's cost structure.

Break-even Point

The point where the amount of goods produced or sold matches the total expenses, leading to neither a profit nor a loss.