Multiple Choice
A sweater that normally sells for \$87 is sold to a customer with a \$12 sales discount and a \$5 sales return. What is the net sales amount for this transaction?
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4. Merchandising Operations
Net Sales
Struggling with Financial Accounting?
Join thousands of students who trust us to help them ace their exams!Watch the first videoMultiple Choice
For a firm, profit equals total revenue minus total _____.
A
expenses
B
equity
C
assets
D
liabilities
Verified step by step guidance1
Understand the concept of profit: Profit is the financial gain a firm achieves when its total revenue exceeds its total expenses.
Identify the formula for calculating profit: Profit = Total Revenue - Total Expenses.
Analyze the options provided: Expenses, equity, assets, and liabilities. Determine which term fits the formula for profit calculation.
Clarify the meaning of each term: Expenses are costs incurred by the firm, equity represents ownership interest, assets are resources owned by the firm, and liabilities are obligations owed by the firm.
Conclude that the correct term to subtract from total revenue to calculate profit is 'expenses,' as it directly impacts the firm's financial gain.
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