14.3

A(n) is a summary of what a company has earned and spent over a given period.

income statement

Gross sales for Nevada Silver, a retailer of silver jewelry was $120,000 for the month of May. Sales discounts amounted to $18,000. There were no returns. The difference, $102,000, is Nevada Silver's:

net sales

Ennis Worth has a six-month loan for $7,500 that he used to refurbish the fishing boat he uses to earn his living. This loan is an example of:

a long-term liability

a short-term loan from a bank, supplier, or others that must be repaid within a year is a(n):

account payable

In manufacturing, all costs directly related to production including raw materials, labor, and factory overhead are classified as:

cost of goods sold

here are two types of expenses recorded on the income statement. They are:

cost of goods sold and operating expenses

Net sales:

deducts sales discount and returns and allowances from gross sales deducting sales returns and allowances from gross sales

The difference between net sales and cost of goods sold is:

gross profit

U.S. Carburetion Inc. makes natural gas and gasoline powered generators. Assume the company had $100,000 in net sales for the week of September 11, Cost of goods sold was $42,000. On an income statement, the remaining $58,000 would be classified as:

gross profit

In 2006, the retail industry voted the Bike Gallery as one of the top 100 bicycle retailers in the United States. It recently purchased a truckload of Thule brand bike racks from the manufacturer. Until the Bike Gallery pays the bill, the purchase will be carried on Thule's books as a(n):

. account payable

Haley Optics manufactures lenses used in cameras, binoculars, and scientific equipment. It had sales of $300,000 during the last quarter. It depreciated assets during the year by $20,000. The Earnings before interest and taxes was calculated to be $120,000. On an income statement, an accountant would classify the remaining $160,000 as:

. cost of goods sold

are bills that have accumulated and must be paid at a specified future date although no bill has been received by the firm.

Accrued expenses

are debts that are to be paid within twelve months.

Current liabilities

The sporting goods store sold $75,000 worth of merchandise in June. The retailer gave no discounts and had no returns. Which of the following statements accurately describes the information seen on the company's income statement?

Gross sales equal net sales.

Which of the following terms equals the total profits of a company minus all dividends (distributions of profits) to stockholders?

retained earnings

The dollar amount of sales plus any other income received from sources like interest and dividends is called:

revenues

Which of the following is NOT an example of a cost of goods sold for a manufacturer of electric fans?

sales commissions

_____ are those expenses related to marketing and distributing of a companies products

selling and general and administrative

Toys "R" Us was founded in 1948. The iconic mascot Geoffrey the Giraffe was introduced in February 1960. Geoffrey used in all ads and promotions used by the retail toy chain is an example of a ______ because it does not have a physical existence.

intangible asset

Trademarks, franchises, patents, and copyrights are carried on the company's books as:

intangible assets