Answer (C) is correct . The operating section of a retailer’s income statement includes all revenues and costs necessary for the operation of the retail establishment, e.g., sales, cost of goods sold, administrative expenses, and selling expenses. Dividend revenue, however, is classified under other revenues. In a statement of cash flows, cash dividends received are considered an operating cash flow.
Answer (A) is incorrect because Sales is part of the normal operations of a retailer.
Answer (B) is incorrect because Cost of goods sold is part of the normal operations of a retailer.
Answer (D) is incorrect because Administrative and selling expenses are part of the normal operations of a retailer.
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