Which of the Following Terms Would Be Found on an Income

question 65

Multiple Choice

Which of the following terms would be found on an Income Statement using variable costing?

• A)Contribution margin
• B)Variable manufacturing overhead
• C)Fixed manufacturing overhead not included in cost of goods sold
• D)Gross profit

---

Definitions:

Indirect Method

A method of reporting cash flows from operating activities by adjusting net income for changes in non-cash accounts.

Direct Method

A way of preparing the cash flow statement where actual cash flow information from the company's operations is used.

Operating Activities

Transactions and events that affect net income, primarily related to the core operations of a business.

Direct Method

An approach to cash flow statement preparation that lists major classes of gross cash receipts and payments.