A merchandiser will earn an operating income of exactly $0 when
A)net sales equals cost of goods sold.
B)cost of goods sold equals gross margin.
C)operating expenses equal net sales.
D)gross profit equals operating expenses.

Question

Quizplus · Accepted Answer

Operating income is calculated as gross profit minus operating expenses. Therefore, when gross profit equals operating expenses, the operating income will be $0.

A Merchandiser Will Earn an Operating Income of Exactly $0