16. Operating Profit is the income after subtracting all the expenses from the gross margin (true/false)...

16. Operating Profit is the income after subtracting all the expenses from the gross margin (true/false)

17. Net profit is after subtracting all expenses from the revenue (true/false)

18. An Income statement is a report showing how well the business used its resources over a period of time. (true/false) 19. A debit increases an asset or an expense account (true/false)

20. Depreciation is the allocation of the cost of an asset with a life longer than a year (true/false)

Expert Solution

Answer-16)- FALSE- Operating Profit is the income after subtracting all the expenses from the gross margin.

Explanation- Operating Profit is the income after subtracting operating expenses from the gross margin.

Answer-17)- TRUE- Net profit is after subtracting all expenses from the revenue.

Explanation- Net profit= Total revenue – All expenses (Operating & Non-operating expenses)

Answer-18)- FALSE- An Income statement is a report showing how well the business used its resources over a period of time.

Explanation- An income statements or profit & loss account shows the organisation revenues & expenses during the particular period.

Answer-19)- TRUE-A debit increases an asset or an expense account.

Explanation- As per the golden rule of accountancy, debit increase the an asset and an expense account.

Answer-20)- FALSE- Depreciation is the allocation of the cost of an asset with a life longer than a year.

Explanation- Depreciation is the allocation of the cost of an asset over its useful life. The asset’s cost is usually spread over the years in which such assets is used.

ekkarill92 answered 2 years ago

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