Question

As an analyst assessing a company's future profit potential, which of the following would you most...

As an analyst assessing a company's future profit potential, which of the following would you most likely disregard?

A-Cost of goods sold.

B- Restructuring charges.

C- Selling expenses.

D-Research and development expense.

Business   Accounting   
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Homework Answers

Answer #1

The correct option is B) Restructuring Charges.

Supporting explanations:

All other costs except restructuring charges can be charged against the revenues while assessing a company's potential capacity of the profits in future but the restructuring costs can not be charged against the revenues as they will increase the future economic benefits so these costs are generally in huge amounts so these costs are not charged against revenues.

Therefore, the analyst should disregard the Restructuring Costs while assessing a company's future profit potential.

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