Kershner Says: "Our Income Statement Should Be Looking Good This

question 164

Multiple Choice

Kershner says: "Our income statement should be looking good this year.We've been doing excellent business this year,so we have a lot of gross sales.The company should be in good shape." Michaels replies: "It remains to be seen how our income statement will look overall.Despite strong sales revenue,the overall income statement might not be as good as we might hope."
Which of the following,if true,would strengthen Kershner's argument?

• A)The total operating expenses were high in the current year.
• B)The company's rent went up 30 percent from the previous year.
• C)The cost of goods sold was low compared to gross sales.
• D)The company is a small one compared to its competitors.
• E)The company has a solid core of fixed assets.

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Definitions:

Nitroamines

Organic compounds containing a nitro group (-NO2) bonded to an amine, often explosive.

Resonance Structures

Resonance Structures are alternative Lewis structures for the same molecule, illustrating the delocalization of electrons within the molecule.

Hybridization

A concept in molecular chemistry describing the combination of atomic orbitals to form new hybrid orbitals suitable for the pairing of electrons to form chemical bonds.

Covalent Compounds

Chemical compounds where atoms are bonded by sharing pairs of electrons, characterized by the formation of molecules.