Which of the Following Statements Regarding a Multistep Income Statement

question 2

Multiple Choice

Which of the following statements regarding a multistep income statement is true?

• A)When a company sells inventory for more than its cost,the difference between the sales revenue and the cost of goods sold is called the operating income.
• B)A single-step income statement shows sales,gross margin,and net income.
• C)Gross margin is calculated as sales revenue minus cost of goods sold.
• D)Gross margin equals net income.

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Definitions:

Perfect Price Discrimination

Perfect price discrimination occurs when a seller charges each buyer their maximum willingness to pay, capturing the entire consumer surplus as profit.

Marginal Revenue

The enhanced income from disposing of one more unit of a product or service.

Perfect Price Discrimination

The practice of charging each customer the maximum they would be willing to pay for a good or service, capturing all consumer surplus.

Willingness To Pay

The maximum amount an individual is prepared to spend on a good or service, reflecting the value they assign to it.