To see how costs are affecting net profit, try analyzing the income statement by expressing each item on the income statement ________.
A) As a percentage of sales
B) As a percentage of profit
C) As a percentage of costs
D) As a percentage of operations
E) As a percentage of assets

Question

Quizplus · Accepted Answer

Expressing each item on the income statement as a percentage of sales allows for easy comparison of costs to revenue and can highlight areas where costs are having the biggest impact on net profit.

To See How Costs Are Affecting Net Profit, Try Analyzing