Which Financial Statement Shows Whether the Business Earned a Profit

question 179

Multiple Choice

Which financial statement shows whether the business earned a profit or loss, and also lists the types and amounts of the revenues and expenses?

• A) Balance sheet
• B) Statement of changes in equity
• C) Statement of cash flow
• D) Income statement.
• E) Statement of financial position

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Definitions:

Maximum Total Profits

The highest possible profit that a firm can achieve, determined by subtracting total costs from total revenues at the optimal level of production.

Quantity

The quantity of a tangible or intangible asset viewed as a single entity or a collective sum.

Graph

A visual representation of data, showing the relationship between variables.

Unit-Profit Margin

The measure of profit derived from each unit of product sold, calculated by subtracting the cost of goods sold from the sales price per unit.