Income Statement(Quick Test #1)

1. The main revenues for a retail store are __________.

2. Sales minus the cost of goods sold equals __________ __________.

3. Sales Discounts is a __________-revenue account.

4. Sales minus 1) Sales Discounts, and 2) Sales Returns and Allowances equals __________ sales.

5. The cost of goods sold is the cost of goods available minus the costs in __________ inventory.

6. If a store sells its old delivery truck for cash and the amount it receives is more than its book value, a __________ is reported on the income statement.

7. The combination of net income and other comprehensive income is known as __________ income.

8. The __________ basis or method of accounting does a better job of measuring a company’s profitability during an accounting period than the cash basis of accounting.

9. The income statement is also known as the statement of earnings and the statement of __________.

10. Some refer to the income statement as the profit and __________ statement.

11. Generally, a merchandiser’s largest expense on its income statement is the __________ __________ __________ __________.

12. If a corporation sells one of its plant assets for a cash amount that is less than the asset’s book value, a __________ on the sale of a plant asset will be recorded and will be reported on the company’s income statement.

13. If the income statement is distributed to stockholders and to others outside of the company, it must be in compliance with generally accepted accounting __________.

14. The organization for researching and establishing the accounting standards for U.S. companies and not-for-profit organizations is the __________ __________ Standards Board.

15. The income statement heading will specify a __________.

16. Revenue and expense accounts are which type of accounts?

17. Does the income statement of a sole proprietorship report the owner’s salary as salary expense?

18. Where are the costs of missed opportunities reported on the income statement?

19. Are U.S. corporation’s required to have their accounting year end on December 31?

20. The expired portion of prepaid premiums for property insurance should be reported as __________.

21. Management’s Discussion and Analysis provides valuable information on the company’s operations during the period of the income statement. It is part of a publicly held corporation’s annual report to the __________.

22. Under accrual accounting, amounts received in advance of providing a service should be reported as __________.

23. A significant amount of supplies that have been purchased at the end of the year 2023 will not be used until the year 2024. At the end of the year 2023, these supplies should be reported as __________.

24. A corporation’s failure to accrue an expense will cause expenses and __________ to be understated.

25. Freight-in under a periodic system

26. Freight-out under a periodic system

27. Purchases of merchandise under periodic system

28. Purchase returns under a periodic system

29. Sales discounts

30. Insurance expense

31. Gain on sale of plant asset

32. Interest expense

33. Delivery expense

34. Sale of merchandise inventory

35. Interest earned

36. Loss on sale of plant asset

37. Bad debts expense

38. Selling expenses

39. Foreign currency adjustments

40. Retailer’s depreciation of display cases