Multiple-step income statements:
A)Are required by the FASB and IASB.
B)Contain more detail than a simple listing of revenues and expenses.
C)Are required for the periodic inventory system.
D)List cost of goods sold as an operating expense.
E)Are only used in perpetual inventory systems.

Question

Quizplus · Accepted Answer

Multiple-step income statements contain more detail than a simple listing of revenues and expenses, including gross profit, operating income, and net income. They are not required by the FASB or IASB specifically, nor are they required only for periodic inventory systems or perpetual inventory systems. Cost of goods sold is typically listed as a separate expense category before operating expenses on a multiple-step income statement.

Multiple-Step Income Statements