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11 January, 18:06

LO 2.1Which of the following represents the components of the income statement for a service business?

Sales Revenue â€" Cost of Goods Sold = gross profit

Service Revenue â€" Operating Expenses = operating income

Sales Revenue â€" Cost of Goods Manufactured = gross profit

Service Revenue â€" Cost of Goods Purchased = gross profit

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  1. 11 January, 19:12
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    Service Revenue â€" Operating Expenses = operating income

    Explanation:

    In the case of service business, the following components of the income statement are service revenue instead of sales revenue and the operating expenses

    In mathematically,

    Operating income = Service revenue - operating expenses

    If we deduct the operating expenses from the service revenue, then the operating income can come
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