Identification of Profit And Loss Account Items - SS1 Accounting Past Questions and Answers - page 1
1
What does revenue include in a profit and loss account?
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A
The cost of goods sold
B
The money a company earned during the period
C
The expenses incurred by a company
2
What is the difference between revenue and gross profit in a profit and loss account?
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A
Revenue is the money earned by a company, and gross profit is the revenue minus operating expenses.
B
Revenue is the money earned by a company, and gross profit is the revenue minus the cost of goods sold.
C
Revenue and gross profit are the same thing.
3
What are operating expenses in a profit and loss account?
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A
The costs incurred by a company to operate its business, such as rent and salaries.
B
The costs incurred by a company to produce its products or services.
C
The non-operating items that affect a company's profit or loss.
4
What is the purpose of other income and expenses in a profit and loss account?
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A
To show the direct costs of producing a company's products or services.
B
To show the non-operating items that affect a company's profit or loss.
C
To show the difference between the revenue and the expenses.
5
What does net profit or loss represent in a profit and loss account?
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A
The total profit or loss made by a company during the period.
B
The difference between the gross profit and the operating expenses.
C
The difference between the revenue and the cost of goods sold.
6
What is the difference between gross profit and operating profit in a profit and loss account?
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7
What is the purpose of analyzing the items in a profit and loss account?
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