Which of the following statements is true of gross-margin format of the income statement?
A) It distinguishes between manufacturing and nonmanufacturing costs.
B) It distinguishes variable costs from fixed costs.
C) It is used for variable costing.
D) It calculates the contribution margin from sales.

Question

Quizplus · Accepted Answer

The gross-margin format of the income statement distinguishes between manufacturing and nonmanufacturing costs, presenting gross margin by subtracting the cost of goods sold (which includes manufacturing costs) from sales revenue.

Which of the Following Statements Is True of Gross-Margin Format