The Money Left Over After Paying for Housing, Food, and Other

question 38

Multiple Choice

The money left over after paying for housing, food, and other necessities is called

• A) Monthly savings.
• B) Discretionary income.
• C) Disposable income.
• D) Gross income.
• E) Take-home pay.

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Definitions:

Vertical Analysis

A method of financial statement analysis in which each entry for each of the three major categories of accounts (or financial statements) is represented as a proportion of the total account.

Common-Size Financial Statement

A financial analysis tool that presents all line items as a percentage of a common base figure, making it easier to compare financial statements of different-sized companies.

Vertical Analysis

A method of financial statement analysis in which each entry for a given period is represented as a proportion of a chosen total.

Operating Cycle

The amount of time it takes for a company to purchase inventory, sell it, and convert the sale back into cash.