Presented Below Are the Major Categories or Captions That Would

question 89

Short Answer

Presented below are the major categories or captions that would appear on an income statement prepared in the variable costing format:
Contribution margin
Fixed costs
Income from operations
Manufacturing margin
Sales
Variable cost of goods sold
Variable selling and administrative expenses
(a) Arrange the above captions in the proper order in accordance with the variable costing concept.
(b) Which of the captions represents:
(1) the difference between sales and the total of all the variable costs and expenses
(2) the remaining amount of revenue available for fixed manufacturing costs, fixed expenses, and net income?

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Definitions:

Partnership Distributions

The sharing out of profits, assets, or earnings among the partners of a partnership based on the agreed-upon terms.

Sole Proprietorship

A business structure where a single individual owns and operates the business, bearing all the business's financial responsibilities and obligations.

Legal Entity

An organization or structure that has legal rights and obligations, including the capability to enter into contracts, sue, and be sued.

Association

An organized group of people who share a common purpose, interest, or activity.