Asked by Ariana Rinehart on Jun 03, 2024
Verified
Which of the following is not a difference between a retail business and a service business?
A) in what is sold
B) the inclusion of gross profit on the income statement
C) accounting equation
D) inventory included on the balance sheet
Retail Business
A business type that sells goods or services directly to end consumers.
Gross Profit
The difference between sales revenue and the cost of goods sold, representing the core profitability of a company's products or services before deducting operating expenses.
Inventory Included
This refers to all items of merchandise, raw materials, work-in-progress, and finished goods that a company holds for the purpose of sale or production.
- Recognize and categorize inventory within the balance sheet.
Verified Answer
ZK
Zybrea KnightJun 05, 2024
Final Answer :
C
Explanation :
The accounting equation (Assets = Liabilities + Equity) applies universally to all businesses, including both retail and service businesses, thus it is not a difference between them.
Learning Objectives
- Recognize and categorize inventory within the balance sheet.