The Following Pertains to Periodic Inventory: on a Merchandising Income

question 15

Multiple Choice

The following pertains to periodic inventory: On a merchandising income statement,which would NOT be found under the heading of Cost of goods sold?

• A) Supplies
• B) Freight-in
• C) Purchases returns and allowances
• D) Purchases

---

Definitions:

Fixed Costs

Costs that do not change with the level of output produced, such as rent or salaries.

Operating Costs

Costs associated with the day-to-day running of a business, including rent, utilities, payroll, and raw materials, but excluding capital expenditures and debt service.

U.S. Electricity

Refers to the production, distribution, and consumption of electrical power within the United States.

Coal And Gas Plants

Facilities where electricity is generated by burning coal or natural gas, playing a significant role in the energy sector despite environmental concerns.