Which of the Following Accounts/captions Are Not Included in the Calculation

question 3

Multiple Choice

Which of the following accounts/captions are not included in the calculation of Gross Profit?

• A)General and Selling Expenses.
• B)Cost of Goods Sold.
• C)Net Sales.
• D)All of these accounts/captions are included in the calculation of Gross Profit.

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Definitions:

Expense Accounts

Accounts used to record the consumption of assets or services that result in a decrease in owner's equity, excluding the withdrawal of business assets by the owner.

Income Summary Account

A temporary accounting ledger that aggregates all income and expenses over a period to calculate net profit or loss.

Adjusting Entries

Bookkeeping entries recorded at the conclusion of an accounting cycle to apportion earnings and outlays to the appropriate period.

Interim Periods

Monthly or quarterly accounting time periods.