Which of the Following Income Statement Formats Is Most Commonly

question 21

Multiple Choice

Which of the following income statement formats is most commonly used with flexible budgeting?

• A) Sales − Variable costs = Contribution margin; Contribution margin − Fixed costs = Net income
• B) Sales − Cost of goods sold = Gross margin; Gross margin − Operating expenses = Net income
• C) Sales − Manufacturing costs − Selling and administrative costs = Net income
• D) None of these answers are correct.

---

Definitions:

Assertiveness

The quality of being confident and self-assured without being aggressive, allowing one to express themselves clearly and respectfully.

Five-factor Model

A theory in psychology that identifies five core personality traits: openness, conscientiousness, extraversion, agreeableness, and neuroticism.

Personality

The combination of characteristics or qualities that form an individual's distinctive character, influencing how they think, feel, and behave.

Erikson's Theory

A psychoanalytic theory by Erik Erikson that outlines eight stages of psychosocial development throughout a person's life.