The normal income statement which
constitutes one of the financial statements of company, is financial income
statement. So functional income statement is an income statement that segregates
all costs by use; it shows revenues less cost of goods sold ( gross margin) less
selling and administrative expenses. This approach is useful for financial
reporting purpose; it provides outside readers with information about company's
progress and about which functional areas are being emphasized. For management's
use in the decision-making process, however, an income statement that follows a
cost behavior approach, often referred to as a Contribution Margin Income
Statement, is more valuable.
单选题
When the management of a business makes some decisions, it often refers to the normal income statement because the normal income statement is more useful.
【正确答案】
B
【答案解析】
单选题
Form the functional income statement we can see clearly the total revenue, total cost and gross profit etc.
【正确答案】
A
【答案解析】
单选题
From the normal income statement we can see gross margin.