Baron Company has six major headings in its income statement, which include Sales, Fees Earned, Other Revenues, Cost of Goods Sold, Operating Expenses, and Other Expenses. Below are some of the income statement accounts for Baron:

Which of these would be found under the heading "Operating Expenses"?

Question

Baron Company has six major headings in its income statement, which include Sales, Fees Earned, Other Revenues, Cost of Goods Sold, Operating Expenses, and Other Expenses. Below are some of the income statement accounts for Baron:

Which of these would be found under the heading "Operating Expenses"?

Quizplus · Accepted Answer

Operating Expenses are expenses incurred in the day-to-day operations of a business. These include salaries and wages, rent, utilities, and supplies. In the given options, the accounts that are considered Operating Expenses are 2. Salaries and Wages Expense, 5. Rent Expense, 7. Utilities Expense, 8. Supplies Expense, and 11. Insurance Expense. Therefore, the best choice(s) would be option C which includes all of the above-mentioned accounts.

Baron Company Has Six Major Headings in Its Income Statement