The Existence of Which of the Following Income Statement Items

question 60

Multiple Choice

The existence of which of the following income statement items will reduce the quality of the bottom-line figure?

• A) Advertising expense
• B) Revenues from services
• C) Cost of goods sold
• D) Extraordinary gain

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Definitions:

Office Rent

Office rent refers to the cost incurred for leasing or renting a space used for business operations or as a company's administrative headquarters.

Direct Materials

Raw materials that are directly attributable to the production process and are part of the finished product.

Factory Supplies

Consumable items used in a manufacturing process, excluding raw materials and labor.

Sales Commissions

A portion of the sale amount given to salespersons as a reward for selling products or services.