Which One of the Following Would Appear on the Income

question 120

Multiple Choice

Which one of the following would appear on the income statement of both a merchandising company and a service company?

• A)Gross profit
• B)Profit
• C)Sales revenues
• D)Cost of goods sold

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Definitions:

Industry Entry

The process of a new competitor or business entering into a market or industry.

Demand

The quantity of a good or service that consumers are willing and able to purchase at various prices at a given time.

Long Run

That period of time for which there are no fixed factors of production: Firms can increase or decrease the scale of operation, and new firms can enter and/or existing firms can exit the industry.

Profit-Maximizing

The process or strategy of adjusting production and sale operations to achieve the highest possible profit.