When a Contract Becomes Unprofitable to an Entity, This Is

question 84

Multiple Choice

When a contract becomes unprofitable to an entity, this is called a(n)

• A) uncompleted contract.
• B) zero-profit contract.
• C) onerous contract.
• D) unenforceable contract.

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Definitions:

Net Sales

The total sales revenue of a company, minus the returns, allowances for damage or loss, and discounts.

Gross Profit

The difference between sales revenue and the cost of goods sold, indicating the efficiency of a company in managing its production and supply chain.

Chief Executive Officer

The highest-ranking executive in a company, responsible for making major corporate decisions, managing overall operations, and resources.

Financial Statements

Financial statements are formal records of the financial activities and position of a business, person, or entity, providing an overview of a financial situation over a specific period.