Which of the Following Is TRUE for a Service Company

question 122

Multiple Choice

Which of the following is TRUE for a service company?

• A) Expenses are all period costs.
• B) Expenses are all product costs.
• C) Income statement includes gross profit.
• D) Balance sheet includes finished goods inventory.

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Definitions:

Corporate Constituency Statutes

A statute that expands the traditional view that directors and officers of a corporation have a duty to make business decisions primarily or exclusively to maximize shareholders’ interests by explicitly permitting the consideration of non-shareholder interests. Those interests may vary but often include the environment, corporate employees, customers, creditors, suppliers, and local community.

Raiders

Individuals or entities that aggressively attempt to take over or acquire control of a business, often through purchasing a substantial portion of its stock.

Corporate Books

The official records of a corporation, documenting essential activities, decisions, and financial transactions.

Freeze-Out Acquisition

A strategy used in mergers and acquisitions where a majority shareholder forces out minority holders to take full control of the company.