Amy Decides to Open a Bakery That Will Specialize in Delicious

question 241

Multiple Choice

Amy decides to open a bakery that will specialize in delicious gourmet brownies. Her explicit costs would include all of these EXCEPT the

• A) business taxes paid on her earnings.
• B) monthly lease payment on the building.
• C) health insurance premiums that she pays for her employees.
• D) interest earnings Amy forgoes from selling her savings bonds to finance her store.

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Definitions:

Legal Authority

An entity or institution that has the legally granted power to make decisions, and to enforce laws or rules.

Financial Statement

A summary report that comprehensively shows a company's financial performance and position at a specific point in time, including the balance sheet, income statement, and cash flow statement.

Statement of Operations

A financial report detailing a company's revenues, expenses, and profits over a specific period, also known as an income statement.

Revenues

Income earned from normal business operations and other activities, often reflected at the top of an income statement.