Multiple Choice
Which of the following is often deducted from gross sales to calculate net sales on the income statement?
18
views
4. Merchandising Operations
Net Sales
Struggling with Financial Accounting?
Join thousands of students who trust us to help them ace their exams!Watch the first videoMultiple Choice
Gross pay refers to which of the following?
A
The net sales revenue after subtracting returns and allowances
B
The employer's contribution to employee benefits
C
The amount remaining after all deductions from an employee's earnings
D
The total amount earned by an employee before any deductions
Verified step by step guidance1
Understand the term 'Gross Pay': Gross pay refers to the total amount earned by an employee before any deductions such as taxes, benefits, or other withholdings.
Differentiate gross pay from net pay: Net pay is the amount remaining after all deductions are subtracted from gross pay. Gross pay is the starting point before deductions.
Clarify the incorrect options: Gross pay is not related to net sales revenue, employer contributions, or the amount after deductions. These are distinct financial concepts.
Relate gross pay to payroll accounting: In payroll accounting, gross pay is calculated based on hours worked, salary, bonuses, and other earnings before applying deductions.
Conclude with the correct definition: Gross pay is the total amount earned by an employee before any deductions, as stated in the correct answer.
9:04mWatch next
Master Net Sales:Sales Discounts (Gross Method) with a bite sized video explanation from Brian
Start learningRelated Videos
Related Practice
