If Sales Increase by 100 Units,by How Much Should Net

question 70

Multiple Choice

If sales increase by 100 units,by how much should net income increase?

• A) $400.
• B) $1,500.
• C) $2,500.
• D) $4,800.

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Definitions:

Owner's Equity Account

Represents the total amount of capital the owner has in a business after liabilities have been subtracted from assets.

Transaction

An agreement or exchange between two parties that involves the sale, purchase, or trade of goods, services, or financial assets.

T-Account

A visual representation of a general ledger account that helps in understanding the effects of transactions on account balances.

Account

A document detailing all dealings related to a specific element of the accounting formula.