A Corporation

question 174

Multiple Choice

A corporation

• A) must use the same depreciation method for tax and financial reporting purposes.
• B) must use different depreciation methods for tax and financial reporting purposes.
• C) may use different depreciation methods for tax and financial reporting purposes.
• D) must use different (than for tax purposes), but strictly mandated, depreciation methods for financial reporting purposes.

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Definitions:

Unit Contribution Margin

Unit contribution margin is the difference between the selling price of a product and its variable costs, indicating how much each unit sold contributes to covering fixed expenses and generating profit.

Sales

The total revenue generated from goods or services sold by a company over a specified period.

Pretax Income

The amount of income earned by a business before any taxes have been deducted.

Fixed Costs

Fixed costs are business expenses that do not change with the level of goods or services produced by the business, such as rent, salaries, and insurance.