Each of a Company's Two Product Lines Has a Different

question 45

Multiple Choice

Each of a company's two product lines has a different contribution margin ratio.If the company's total sales remain the same but the sales mix shifts toward selling more of the product with the lower contribution ratio, which of the following is true?

• A)Operating income will decrease.
• B)The average contribution margin ratio will decrease.
• C)The breakeven point will increase.
• D)All of the answers are true.

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Definitions:

Professional Scepticism

An attitude that includes a questioning mind and a critical assessment of audit evidence.

Confidentiality

The obligation to protect sensitive information from unauthorized access or disclosure, ensuring privacy and security.

Competence

The ability or skill of an individual or organization to effectively perform or carry out a particular task or role.

Basic Information System

A foundational structure that collects, stores, manages, and distributes information for the purpose of improving decision-making and coordination.