Which of the following costs is most likely to be the largest expense item on the income statement of a merchandising chain such as Walmart?
A)Wage,salary and benefits expense
B)Advertising
C)Cost of Sales
D)Income tax expense

Question

Quizplus · Accepted Answer

Cost of sales, also known as the cost of goods sold, is the direct cost of purchasing the goods sold by the company. For a merchandising chain like Walmart, this would be the cost of purchasing the products they sell. As the cost of sales is subtracted from the revenue to determine the gross profit, it is typically the largest expense item on the income statement.

Which of the Following Costs Is Most Likely to Be