Which of the following would be a suitable format for the statement of financial performance for a medium size furniture store operation as a partnership?
A)income - expenses = profit
B)sales - cost of sales = gross profit - expenses = profit
C)income + expenses = profit
D)sales - cost of sales = gross profit

Question

Quizplus · Accepted Answer

The format in option B provides a complete picture of the financial performance of the furniture store operation, taking into account both the revenue and cost of sales. Subtracting expenses from the gross profit will give the net profit, which is the final figure that reflects the overall financial performance of the business. Options A and C are too simplistic and do not provide enough information, while option D only gives the gross profit and does not take into account the expenses.

Which of the Following Would Be a Suitable Format for the Statement