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Which of the following would be found on an income statement? (A) Accounts payable (B) Gross profit (C) Intangibles (D) Net assets - HSC - SSCE Business Studies - Question 10 - 2014 - Paper 1
Question 10
Which of the following would be found on an income statement? (A) Accounts payable (B) Gross profit (C) Intangibles (D) Net assets
Worked Solution & Example Answer:Which of the following would be found on an income statement? (A) Accounts payable (B) Gross profit (C) Intangibles (D) Net assets - HSC - SSCE Business Studies - Question 10 - 2014 - Paper 1
Step 1
Which of the following would be found on an income statement?
Answer
To determine which option is found on an income statement, we need to analyze each option:
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(A) Accounts payable: This is a liability and typically appears on the balance sheet, not on the income statement.
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(B) Gross profit: This is a key figure on the income statement, calculated as sales revenue minus cost of goods sold (COGS). It represents the profitability from core business activities.
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(C) Intangibles: These are assets that are not physical in nature and are recorded on the balance sheet, not the income statement.
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(D) Net assets: This term refers to total assets minus total liabilities and appears on the balance sheet.
From the analysis, the correct answer is (B) Gross profit, as it is the only option that is found on an income statement.