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Partial Income Statements of Company a and Company B Are

question 135

Multiple Choice

Partial income statements of Company A and Company B are provided below: Company A
$\begin{array} { | l | r | r | } \hline \text { Revenue } & & \$ 80,000 \\\hline \text { Expenses: } & & \\\hline \text { Utilities Expense } & \$ 5,000 & \\\hline \text { Salaries Expense } & 15,000 & \\\hline \text { Rent Expense } & \underline { 3,700 } & \\\hline \text { Total Expenses } & & \underline { 23,700 } \\\hline \text { Operating Income } & & \$ 56,300 \\\hline\end{array}$ Company B
$\begin{array} { | l | r | r | } \hline \text { Revenue } & & \$ 50,000 \\\hline \text { Cost of Goods Sold: } & & \\\hline \text { Beginning Merchandise Inventory } & \$ 4,000 & \\\hline \text { Purchases and Freight In } & 23,000 & \\\hline \text { Cost of Goods Available for Sale } & 27,000 & \\\hline \text { Ending Merchandise Inventory } & \underline { ( 5,500 } & \\\hline \text { Cost of Goods Sold } & & \underline { 21,500 } \\\hline \text { Gross Profit } & & \$ 28,500 \\\hline\end{array}$ Which of the following statements is TRUE?

Definitions:

Performance Measure

Metrics or indicators used to evaluate the efficiency, effectiveness, or success of an organization's activities.

Balanced Scorecard

A management system designed for strategic planning that ensures alignment of business operations with the organization's vision and strategy, enhances communication within and outside the organization, and tracks the organization's performance in relation to its strategic objectives.

Performance Measure

An indicator used to assess, compare, and track performance or efficiency, often applied to individuals, organizations, processes, or products.

Appraisal Cost

The cost of activities specifically designed to detect defective products or services before they reach the customer.