Reference no: EM132690657

Problem 1: Which of the following represents the components of the income statement for a manufacturing business?

Select correct one

a. Sales revenue - Cost of Goods Sold = gross profit
b. Service Revenue - Operating Expenses = Gross profit
c. Service Revenue - Cost of Goods Manufactured = Gross profit
d. Sales Revenue - Cost of Goods Manufactured = gross

Problem 2: Variable costs are expenses that _____________

Select correct one

a. remains constants on per unit basis but change in total based on activity level
b. remains constant on per unit basis and remain constant in total regardless of activity level
c. decrease on a per unit basis as activity level increases
d. remains constant in total regardless of activity level within a relevant range