Question

Which of the following items would be reported in the "Other expenses and losses" section of a multi-step income statement?

		Gain on disposal of plant assets.
		Freight out.
		Salaries and wages expense.
		Casualty loss from vandalism.

Which of these statements about credit card sales is incorrect?

		The retailer generally considers the sales as cash sales.
		The retailer gets paid even if the buyer's use of the credit card was fraudulent; "chargebacks" do not occur.
		The retailer must pay a card issuer a fee for processing the transactions.
		The retailer generally receives payment more quickly than if it had to process its own receivables.

Answer 1

Solution:

1) Casuality loss from vandalism ,

Rest of the options are comes under direct and indirect expense for the business, where as casuality loss comes under other losses and expenses and category.

2) The retailer get's paid even if the buyers use of the credit card was fraudulent, chargebacks do not occur.

If the buyer's card was fraudulent , the retaier will not get money from anywhere. After the transaction, It is the responsibility of the retailer to check his account balance and ensure that whether transaction is fraud or not.Rest of the statements are true supposed to the credit card dealings.