Which of Following Procedures Provides an Example of Minimal Support

question 26

Multiple Choice

Which of following procedures provides an example of minimal support for conclusions?

• A) comparison of sales commissions with related sales
• B) comparison of direct labour costs and the number of employees with prior periods
• C) comparing selling prices less selling costs to normal gross margins
• D) none of the above

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Definitions:

Accounting Purposes

The specific reasons or objectives for maintaining financial records and conducting financial analyses, including compliance, reporting, and decision-making.

Legal Purposes

Activities or actions that are undertaken in accordance with law and designed to effectuate legal ends.

Retained Earnings

The portion of net income not distributed as dividends but retained by the company to reinvest in its business or to pay debt.

Net Income

The final income of a firm following the deduction of all expenditures, taxes, and interest from the gross revenue.