Answer:
Option A Net revenues less cost of goods sold
Explanation:
The IASB sets the Financial reporting framework which states that the gross profit will be derived from the deduction of cost of goods sold from the Net revenues. So the correct option is Option A.
The main function of a service business is the delivery of value to the customer.
- A service business is made up of experts who help in the delivery of a particular work. Examples of service businesses include food service, transportation, retail, distribution etc.
- It should be noted that every business wants to make a profit. Profit is important in order to grow the business. Despite the profit making motive of businesses, some businesses are more concerned with how to retain their customers.
In conclusion, it should be noted that the retaining of customers are vital in brand loyalty and the growth of the business.
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Answer:
Dr. Allowance for Doubtful Accounts $7,400
Cr. Accounts Receivable $7,400
Explanation:
A write off eliminates the account receivable balance. It is recorded as the debit to Allowance for Doubtful Accounts because of its credit nature. It reduces the balance of the allowance use it for actual write off. On the other hand it credit the account receivable balance to reduce it as it is debit in nature.
Answer:
c. Reject the project because the NPV is negative $120,921
Explanation:
As we know that the depreciation is a non-cash expense so here we need to add the depreciation expense again
Now the cash inflow would be $100,000 each year i.e. for 5 years
And, the initial investment is $500,000
Now we have to use the formula of NPV in an excel by using the NPV function
=NPV(rate,Year1 to Year5 cashflows)-Year0 cashflow
=NPV(10%,Year1 to Year5 cashflows)-500000
=-120,921
So as we can see that the npv comes in negative so the project should be rejected
Therefore the correct option is c.