Which of the following statements is true regarding the use of different types of income statements?
A) Traditional GAAP income statements are used for internal financial reporting purposes only.
B) Contribution margin income statements are used for external financial reporting purposed only.
C) Traditional GAAP income statements separate variable and fixed costs, which help in internal decision making.
D) Contribution margin income statements separate variable and fixed costs, which help in internal decision-making.

Question

Quizplus · Accepted Answer

Contribution margin income statements separate variable and fixed costs, which is useful for internal decision-making, such as cost-volume-profit analysis. Traditional GAAP income statements do not separate costs in this manner.

Which of the Following Statements Is True Regarding the Use