The First Caption in Most Income Statements in Annual Reports

question 9

Multiple Choice

The first caption in most income statements in annual reports is:

• A)gross sales.
• B)net sales.
• C)earned revenues.
• D)sales, less sales returns and allowances.

---

Definitions:

Salvage Value

The estimated residual value of an asset at the end of its useful life.

Double Declining-Balance Depreciation

An accelerated depreciation method that doubles the rate of straight line depreciation.

Depreciation Expense

The systematic allocation of the cost of a tangible asset over its useful life, reflecting the asset's consumption or loss of value.

Declining Balance Depreciation

A depreciation method that applies a constant rate to the declining book value of an asset, resulting in accelerated depreciation.