The Degree of Operating Leverage

question 109

Multiple Choice

The degree of operating leverage

• A) does not provide a reliable measure of a company's earnings volatility.
• B) cannot be used to compare companies.
• C) is computed by dividing total contribution margin by net income.
• D) measures how much of each sales dollar is available to cover fixed expenses.

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Definitions:

Somatic Nervous System

The somatic nervous system is part of the peripheral nervous system responsible for controlling voluntary movements of the body and transmitting sensory information to the central nervous system.

Central Nervous System

The part of the nervous system consisting of the brain and spinal cord, responsible for processing and sending out information throughout the body.

Sensory Neurons

Nerve cells that are responsible for converting external stimuli from the environment into internal electrical impulses.

Stem Cells

Undifferentiated cells with the potential to develop into many different cell types that can contribute to repairing and replenishing tissues.