A Suggested Allowance for Contingencies and Emergencies at Start-Up Is

question 9

Multiple Choice

A suggested allowance for contingencies and emergencies at start-up is ________ percent of estimated start-up costs, although more is better.

• A) 5
• B) 10
• C) 25
• D) 40

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Definitions:

Operating Expenses

Costs associated with the day-to-day operations of a business, such as salaries, utilities, and rent.

Income Statement

A report documenting a business's financial activities, including income, expenses, and net profit, for a particular period.

Period Cost

Expenses that are incurred in a particular time period and are not directly tied to the production process, such as selling, general, and administrative expenses.

Advertising Expense

A cost incurred by a business to promote its products, services, or brand names.