http://www.kenniffonline.com/net-profits-equation/
Can someone please help me with this accounting question?
1. The profit in cost-volume-profit equations is the same as the net operating income on a contribution income statement.
-I think its True
2. A contribution approach income statement can usually be easily prepared from the information contained in a corporation’s published income statement.
-I think its false
You are correct on both of them.
To explain a little about 2), the corporation’s income statement won’t say how many units were sold, just the total sales revenue collected, hence one can’t find the contribution margin or prepare a contribution approach income statement without more information.
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