Which of the Following Expressions Is Incorrect

question 95

Multiple Choice

Which of the following expressions is incorrect?

• A) Gross profit - operating expenses = net income
• B) Sales revenue - cost of goods sold - operating expenses = net income
• C) Net income + operating expenses = gross profit
• D) Operating expenses - cost of goods sold = gross profit

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Definitions:

Indirect Materials

Materials used in the production process that do not directly become part of the finished product.

Manufacturing

The procedure of changing basic materials, components, or elements into end products that align with a customer’s needs or criteria.

Direct Materials

Raw materials that can be directly traced to the manufacturing process of a product and are a significant part of its cost.

Secondary Materials

Materials used in the production process that are not the primary raw materials.