Which of the Following Formats Is Typically Used in Year-To-Date

question 43

Multiple Choice

Which of the following formats is typically used in year-to-date income statements prepared for internal use under a responsibility accounting system?

• A) Sales - Cost of Goods Sold = Gross Margin; Gross Margin - Operating Expenses = Net Income
• B) Sales - Manufacturing Costs = Manufacturing Margin; Manufacturing Margin - Selling and Administrative Costs = Net Income
• C) Sales - Variable Costs = Contribution Margin; Contribution Margin - Fixed Costs = Net Income
• D) None of these answers are correct.

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Definitions:

Line Extension

A marketing strategy where a company introduces additional items in the same product category under the same brand name, such as new flavors, forms, colors, added ingredients, or package sizes.

Homemade Soda

Soda made at home using ingredients and methods that allow customization and control over the final taste.

Family Brand

A marketing strategy in which a range of products is marketed under a single brand name, aiming to capture consumer trust and loyalty.

Private-label Brand

Products manufactured by one company but sold under another company's brand, typically a retailer’s brand.