Which Is the Correct Order for Items to Appear on the Income

question 118

Multiple Choice

Which is the correct order for items to appear on the income statement?

• A) Sales revenue, operating expenses, gross profit, net income
• B) Sales revenue, gross profit, net income, operating expenses
• C) Sales revenue, gross profit, cost of goods sold, operating expenses
• D) Sales revenue, cost of goods sold, gross profit, net income

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Definitions:

Program Service Expenses

Costs directly incurred in carrying out the operational activities aligned with the mission of a non-profit or governmental organization.

Supporting Service Expenses

Costs incurred by a business or organization for activities that aid the operation but do not directly contribute to the main business activity.

Not-for-Profit Entity

An organization that operates for charitable, educational, cultural, religious, or other purposes serving the public interest, where profitability is not the primary goal.

Supporting Services Expenses

Costs incurred for activities that assist the core operations of a business but do not directly contribute to production.