Which One of the Following Statements Related to an Income

question 30

Multiple Choice

Which one of the following statements related to an income statement is correct? Assume accrual accounting is used.

• A)The addition to retained earnings is equal to net income plus dividends paid.
• B)Credit sales are recorded on the income statement when the cash from the sale is collected.
• C)The labor costs for producing a product are expensed when the product is sold.
• D)Interest is a non-cash expense.
• E)Depreciation increases the marginal tax rate.

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Definitions:

Preset Count

A predetermined value used in counting applications to trigger an event when a counter reaches this value.

Input

Data or signals received by a system, device, or computational process for processing or manipulation.

Closed

Often refers to a circuit or loop that is complete and allows electrical current to flow through it.