Which of the following,if true,would strengthen Kershner's argument?
A) The total operating expenses were high in the current year.
B) The company's rent went up 30 percent from the previous year.
C) The cost of goods sold was low compared to gross sales.
D) The company is a small one compared to its competitors.
E) The company has a solid core of fixed assets.

Question

Quizplus · Accepted Answer

C)This means that gross profit will be relatively high, which makes it more likely that the company will have a positive income statement. Choice A would weaken Kershner's argument, since it suggests that net income will be lower than he suggests. Choice B would tend to weaken Kershner's argument since rent is an operating expense. Choices D and E are statements that do not directly impact the company's income statement.

Which of the Following,if True,would Strengthen Kershner's Argument