Answer the Following Questions Using the Information Below:
Stosur Courtside

question 1

Multiple Choice

Answer the following questions using the information below:
Stosur Courtside Caterers is a small company that has hired you to perform some management advisory services.The following information pertains to 2018 operations.
$$\begin{array} { l r } \text { Sales (5000 microwave ovens) } & \$ 1350000 \\\text { Cost of goods sold } & 540000 \\\text { Store manager's salary per year } & 75000 \\\text { Operating costs per year } & 225000 \\\text { Advertising and promotion per year } & 25000 \\\text { Commissions (4\% of sales) } & 67500\end{array}$$
-What were total fixed costs for 2018?

• A)$250 000
• B)$225 000
• C)$325 000
• D)$932 500

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Definitions:

Net Income

The total earnings of a company after subtracting all expenses, including taxes and interest, from its total revenue.

Trial Balance

A bookkeeping worksheet in which the balances of all ledgers are compiled into debit and credit account columns to ensure a company's bookkeeping system is mathematically correct.

Income Statement

A financial statement that shows a company's revenues and expenses over a specific period, leading to net income or loss.

Insurance Expense

The amount a company spends on insurance policies to cover various risks, recorded as an expense in the accounting period in which it is incurred.