Assume Sales Volume of 3,000 Units, Unit Variable Cost of $3

question 22

Short Answer

Assume sales volume of 3,000 units, unit variable cost of $3, fixed costs of $15,000. What is operating leverage? a. 60%
B) 37.5%
C) 20%
D) 62.5%
E) 1.6%

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Definitions:

Financing Activities

Financing activities are transactions related to raising capital and repaying borrowed funds, such as issuing stocks or bonds, and are reported in the cash flow statement.

Treasury Stock

Shares that were issued and subsequently reacquired by the issuing company, reducing the amount of outstanding stock on the open market.

Bonds Payable

A classification in accounting for debts of a corporation due to be paid to bondholders at a specified date.

Operating Activities Section

Part of a cash flow statement that shows the cash generated or used in the primary revenue-producing activities of the business.