The Equation Which Reflects a CVP Income Statement Is

question 41

Multiple Choice

The equation which reflects a CVP income statement is

• A) Sales = Cost of goods sold + Operating expenses + Net income.
• B) Sales + Fixed costs = Variable costs + Net income.
• C) Sales - Variable costs + Fixed costs = Net income.
• D) Sales - Variable costs - Fixed costs = Net income.

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Definitions:

Sole Proprietorship

A business structure owned by a single individual, where the owner has unlimited liability.

Corporation

A legal entity created by individuals, shareholders, or shareholders, with rights and liabilities distinct from those of its members, recognized as such under law.

Partnership

A business setup legally established by two or more partners who divide management duties and profits.

Consumer Cooperative

A type of cooperative that is owned and operated by its members, with the aim of reducing costs and/or improving the quality of goods and services.