Problem

Matching Definitions with Income Statement Related TermsFollowing are terms related to the...

Matching Definitions with Income Statement Related Terms

Following are terms related to the income statement. Match each definition with its related term by entering the appropriate letter in the space provided.

 

Terms

Definitions

——

(1)

Net income

A.

Revenues + Gains — Expenses - Losses including effects of discontinued operations and extraordinary items (if any).

——

(2)

Income tax expense on operations

B.

Income Tax on Revenues - Operating Expenses.

——

(3)

Income before extra

C.

Sales Revenue — Cost of Goods Sold

——

 

ordinary items

D.

Sales of services for cash or on credit.

——

(4)

Cost of goods sold

E.

Amount of resources used to purchase or produce the

——

(5)

Operating expenses

F.

goods that were sold during the reporting period. Total expenses directly related to operations.

——

(6)

Gross margin on sales

G.

Income before all income tax and before discontinued operations and extraordinary items (if any).

——

(7)

EPS

H.

Cost of money (borrowing) over time.

——

(8)

Interest expense

I.

Item that is both unusual and infrequent.

——

(9)

Service revenue

J.

Net Income -=− Average Shares Outstanding.

——

(10)

Pretax income from operations

K.

Income before unusual and infrequent items and the related income tax.

 

 

 

L.

None of the above.

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