Degree of Operating Leverage Is Calculated by Dividing Sales by Profit

question 78

True/False

Degree of operating leverage is calculated by dividing sales by profit.

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Definitions:

Financial Accounting

The branch of accounting that is concerned with recording transactions using generally accepted accounting principles (GAAP) for a business or other economic unit and with a periodic preparation of various statements from such records.

Traditional Manufacturing

A manufacturing approach that involves a series of discrete steps or stages in a production process, often characterized by manual labor and the use of conventional machinery.

Push Manufacturing

A production strategy where items are produced based on forecasted demand, pushing them onto the market regardless of immediate need.

Process-Oriented Layout

The organization of work around a process (task).