Gross profit is defined as:
A. what is left after deducting the cost of goods sold.
B. what is left after deducting the operating expenses of the business.
C. the amount of money the owner takes out of the firm annually.
D. the profit earned by a company when its product is in the maturity stage of the
product life cycle.
Which of the following is true of accounting equation?
A. It is used to place records into understandable categories that are useful for
managing a business.
B. It assumes that a successful business will stay in business and this enables
long-range planning and strategy.
C. It underlies the legal forms of establishing businesses, such as corporations, limited
partnerships, and limited liability companies.
D. It ensures that accounting information is useful to the firm’s stakeholders.