Which Statement Is Not Correct About Expenses in the Income

question 80

Multiple Choice

Which statement is not correct about expenses in the income statement?

• A)The function of expense format classifies expenses based on their use.
• B)Some nature of expense categories are depreciation, employee costs, raw materials consumed.
• C)The nature of expense format classifies expenses based on their source.
• D)Some nature of expense categories are cost of sales, administration or warehouse.

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Definitions:

Total Cost

The sum of all costs incurred by a business in the production of goods or services, including fixed and variable costs.

Input

Resources (such as labor, materials, and capital) used in the production process to create goods or services.

Marginal Resource Cost

The additional cost incurred by a firm for using one more unit of input, like labor or raw materials.

Labor

The effort by workers to produce goods or services, typically measured in terms of hours worked or output produced.