The Phenomenon Where Producing More Such That the Average Cost

question 77

Multiple Choice

The phenomenon where producing more such that the average cost of production for the item decreases is known as

• A)economies of scale.
• B)diseconomies of scale.
• C)best operating level.
• D)efficiency.

---

Definitions:

Break-Even Sales

The amount of revenue needed to cover all fixed and variable costs, resulting in a net income of zero.

Retail Division

A segment of a company that directly sells products to consumers, typically involving activities and costs related to retail operations.

Segmented Income Statement

An income statement that breaks down revenues, cost of sales, and expenses by segments such as product lines, departments, or geographic regions.

Contribution Format

A method of income statement presentation that separates fixed and variable costs, making it easier to see the contribution margin.