Which of the Following Would Not Be Considered an Example

question 245

Multiple Choice

Which of the following would not be considered an example of a discontinued operation?

• A) Shifting production processes within an operation
• B) Elimination of a major class of customers
• C) Elimination of an entire activity
• D) Disposal of a significant component of a business

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Definitions:

Fixed Costs

Costs that do not vary with the level of production or sales, such as rent, salaries, and insurance premiums, providing stability to a company's expense structure.

Depreciation Expense

The allocated amount of the cost of an asset that is written off as an expense over its useful life.

Sales Price

The sum of money that a purchaser spends to acquire a product or service from a vendor.

Contribution Margin

The revenue remaining after deducting variable costs, which can be used to cover fixed costs and contribute to profit.