Contribution Margin Statements

question 14

Multiple Choice

Contribution margin statements:

• A) Can be utilized to evaluate the effect of possible activity changes on profit before taxes.
• B) Cannot be utilized to evaluate the effect of possible activity changes if those changes also change fixed costs.
• C) Will not provide an alert if cost behaviors vary from those expected.
• D) Identify variable and fixed costs but will not address changes in revenues.

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Definitions:

List of Virtues

A catalog or enumeration of virtues, which are qualities considered morally good or desirable in a person.

Ideal Person

A concept or model of perfection in terms of virtues, traits, or characteristics that is regarded as exemplary.

Determinist

A person who holds that everything that happens is completely determined (or caused) by prior conditions and influences.

Free Choice

The ability or discretion to choose freely among different options without being limited or compelled.