Examples of Functional Areas of the Income Statement Are

question 40

Multiple Choice

Examples of functional areas of the income statement are

• A) sales, gross profit, and net income.
• B) cost of sales, administrative activities, and selling activities.
• C) wages expenses, depreciation, and rent expense.
• D) gross profit, operating income, and net income.

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Definitions:

Identical Service

A service that is exactly the same in every feature and aspect when compared to another service.

Efficient Output

The level of production at which a company or economy can produce goods at the lowest possible cost per unit, maximizing the allocation of resources.

Perfect Competitor

A hypothetical firm in a perfectly competitive market that cannot influence the market price of its product and takes the market price as given.

Marginal Cost

A concept in economics that refers to the change in the total cost when an additional unit of a product is produced.