A Primary Characteristic That Distinguishes Not-For-Profit Entities from Businesses Is

question 13

Multiple Choice

A primary characteristic that distinguishes not-for-profit entities from businesses is

• A)The need to generate revenues equal to or in excess of expenditures/expenses.
• B)The importance of the budget in the governing process.
• C)The need to provide goods or services.
• D)The correlation between revenues generated and demand for goods or services.

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Definitions:

Break-Even Quantity

The amount of product that must be sold to cover the costs of production, resulting in neither a profit nor a loss.

Operating Cash Flow

The amount of cash generated by a company's normal business operations, indicating whether a company is able to generate sufficient positive cash flow to maintain and grow its operations.

Variable Cost

Costs that vary directly with the level of production or volume of output, such as materials and labor.

Operating Leverage

A measure of how revenue growth translates into growth in operating income, determined by the company's fixed versus variable costs.