QUESTION 24 The difference between sales and cost of goods sold for a merchandising business is called: a operating expenses b. gross profit cnet sales d. gross sales QUESTION 25 East Inc. buys inventory on account. Which of the following is true regarding the impact of this transaction on the accounting equation? a. Revenues increase: liabilities increase b. Expenses increase: liabilities decrease. Assets increase: liabilities increase d. Assets decrease: liabilities decrease QUESTION 26 Sunshine Inc. has the following balances: Net Sales $50,000 Cost of Goods Sold $15,000 Operating expenses $20,000 What is Sunshine Inc.'s gross profit? a. $30,000 b. $45,000 $15,000 d. $35,000 QUESTION 27 Which of the following accounts are subtracted from gross profit to arrive at net income? a. Operating expenses b. Accounts payable c. Accounts receivable d. Cost of goods sold