A Contra-Asset Is Deducted from the Related Asset on the Balance

question 103

True/False

A contra-asset is deducted from the related asset on the balance sheet.

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Definitions:

Operating Expenses

Costs incurred in the normal operations of a business, such as rent, utilities, and payroll.

Net Income

The conclusive financial gain of a company after expenses and taxes have been removed from the initial total revenue.

Merchandising Company

A type of business that purchases goods in a finished condition for resale without further processing.

Sells Directly

A method where companies sell their products or services directly to consumers without involving intermediaries, aiming to enhance customer relationships and control the sales process.