Identify which one or more of the following equations is not correct.
A)Revenues - Expenses = Gross Profit
B)Stockholders' Equity = Paid-in Capital + Retained Earnings
C)Assets - Liabilities = Stockholders' Equity
D)All of these answers are correct.

Question

Quizplus · Accepted Answer

Gross Profit is calculated by subtracting the Cost of Goods Sold (COGS) from Revenues, not Expenses from Revenues. Expenses are subtracted from Gross Profit to determine Net Income.

Identify Which One or More of the Following Equations Is