What Is the Required Increase in Sales to Have the Same

question 77

Multiple Choice

What is the required increase in sales to have the same effect on the bottom line as a 10-percent reduction in the cost of materials?

• A)25%
• B)50%
• C)56%
• D)100%

---

Definitions:

Equipment

Tangible assets used in the operation or production process of a business, such as machinery, computers, and tools.

Interest Rate

The percentage of a loan that is applied as interest for the borrower, usually shown as an annual rate.

Account

A record summarizing all the transactions pertaining to a particular item in the financial statements.

Annual Rate

The interest rate stated on a yearly basis, often used in the context of savings accounts, loans, or investments to represent the yearly cost or return.