Home » Accounting: Principles of Financial Accounting » Which of the following statements is correct? Which of the following statements is correct? 1. Question 1 Which of the following statements is correct? 1 / 1 point The income generated by a company as a result of profitable operations during a period is added to the Share Capital account in Owners’ Equity. The difference between sales and cost of sales is called Net Profit. The final line item in an income statement is called Net Income, Net Profit (or Net Loss). Operating Income is the same as Earnings Before Interest, Depreciation and Amortization (EBITDA). Other Questions Of This Category Fibertech GmbH is a distributor of outdoors technical clothing. The company outsources the production of clothing to external manufacturers in Bangladesh and sells the clothing under its own brands.…Agrokinsey Inc. acquires a new piece of equipment in the beginning of 2016 at a cost of €20,000. The company estimates that the equipment’s useful life is 10 years and its salvage value €4,000.…Reviewing the Income Statement (questions 18 – 20) Vertikal SA imports and distributes climbing gear. Its profit and loss account for the year x5 has the following items (amounts in €000): · Debits:…Irwin Company obtained a five-year, €100,000 bank loan at the end of year x0. The principal had to be repaid in equal installments every December 31st starting in x1. The yearly interest rate is 4%…What is the effect of the transaction described above on the profit and loss account?For the remaining questions, please consider the following transactions that happened in The Dorchester Company Ltd. in 2015 (amounts in £000): · Credit sales amounted to 5,000 (nothing was paid by…Which of the following statements is incorrect?Understanding how accounts relate to each other (questions 10 – 13): The managers of Moreton, Inc. prepared the following summaries of their company's assets and liabilities (amounts are in €…Downton Smith Ltd. purchased a piece of machinery on Jan 1st 2013 for €400,000. The company estimated a useful life of 10 years and a residual value of zero for this asset. On December 31st 2015, the…Suppose a business had assets totaling €20,000 and liabilities totaling €17,000. What was its owners’ equity?Understanding the difference between cash and profit (questions 4 – 5): The ABC Company recognizes credit sales of €100,000. The cost of the goods sold is €60,000. Answer the following two questions:…The following table shows the balance of certain accounts on the Holmes, Inc. balance sheet at the end of December 31 and the following three-day period. By December 31, the company had not yet…The following table shows the balance of certain accounts on the Holmes, Inc. balance sheet at the end of December 31 and the following three-day period. By December 31, the company had not yet…The following table shows the balance of certain accounts on the Holmes, Inc. balance sheet at the end of December 31 and the following three-day period. By December 31, the company had not yet…What is the accumulated depreciation at the end of the 10 years (i.e. end of useful life)?