Sole Trader Income Statement Excludes Director's Fees

Steps:

• Identify income statement components: revenues minus operating and finance expenses for sole traders.
• Evaluate A: accounting charges as professional service expenses.
• Evaluate B: bank loan interest as finance costs.
• Evaluate C: director's fees irrelevant to sole trader structure.
• Evaluate D: rental charges as operating expenses.

Why C is correct:

• Sole traders are unincorporated businesses owned by one person with no directors; director's fees apply only to companies under corporate law.

Why the others are wrong:

• A: Accounting charges are deductible business expenses for professional services.
• B: Bank loan interest is a finance expense reducing net profit.
• D: Rental charge for machinery is an operating expense for asset use.

Final answer: C