Which One of the Following Is the Format of a CVP

question 37

Multiple Choice

Which one of the following is the format of a CVP income statement?

• A)sales - variable costs = fixed costs + net income
• B)sales - fixed costs - variable costs - operating expenses = net income
• C)sales - cost of goods sold - operating expenses = net income
• D)sales - variable costs - fixed costs = net income

---

Definitions:

Variable Costs

Costs that vary depending on the amount of production or business operations.

Lease Cost

The expense incurred from leasing equipment or property, typically categorized as an operating expense in financial statements.

Average Lease Cost

The mean expense incurred from leasing agreements, spread over the term of the lease, generally considered for assets such as equipment or real estate.

Sales Volume

The total quantity of products or services sold by a company within a specific period.