Give two similarities or two major differences between manufacturing and service companies' financial statements. Also, discuss the major differences between the single step and multiple step income statements and why users might prefer one statement over the other.

Describe the three-line items of the multistep income statement. Explain why it would be important for a company to break out its income in this manner.

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Financial analysis and forecasting are based on assumptions and estimates. Comparing the income of two companies may include different company assumptions in reporting their financial information. Therefore, their income may be different even though they have the same products in equal volume. Discuss the various financial/accounting assumptions that could explain the difference in income for two companies’ income with the same products and equal volume.

When choosing between the ‘nature’ and ‘function’ of expenses in the presentation of its statement of comprehensive income, a company should:   A. select the method that results in the lowest income.   B. select the method that is easiest to implement.   C. select the method that best reflects the nature of its business.   D. select the method that results in the highest income.

Explain why balance sheet accounts are generally “averaged” and income statement figures are just lifted from the income statement when using them as factors in a particular financial statement ratio? How do the DuPont technique helps the firm’s managers to further analyze its returns?

Using the information for Lighthizer Trading Company, prepare the income statement to include all costs, but separate out uncontrollable costs. Insert subtotals where appropriate (include one for operating income) before the uncontrollable costs. Income tax expense should be based on all expenses (that is, it will be the same amount as in the previous exercise). Calculate net income, profit margin, ROI, and RI excluding uncontrollable expenses. Prepare a short response to accompany the income statement that explains why uncontrollable costs are separated in the income statement.

Which of the following accounts would be reported under operating expenses on a multi-step income statement? A. sales B. advertising expense C. sales returns and allowances D. interest expense

1. State whether the following questions is True (T) or False (F): a. Cost accounting looks at the company as a whole and not at the various units, jobs or processes. b. Financial accounting is concerned with how and why profits arise. c. Cost accounting depends entirely on historical information.

Which of the following is NOT an example of a metric that companies are likely to use to measure some aspect of performance? a. Operating income b. CEO salary c. Cash flows d. Average employee tenure