Which of the Following Is Typically Used as the Base

question 69

Multiple Choice

Which of the following is typically used as the base in a vertical analysis of an income statement?

• A)gross profit
• B)operating income
• C)net income
• D)net sales

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Definitions:

Asset’s Use

The utilization of an asset in a way that enhances its value or contributes to earning revenue.

Manufacturing Company

A company that uses raw materials, labor, and equipment to produce finished goods on a large scale.

Productivity

The measure of the efficiency of production, often evaluated as the ratio of outputs to inputs in a manufacturing or service process.

Double-Declining-Balance

An accelerated method of depreciation calculating depreciation at twice the rate of the straight-line depreciation method.