Discontinuing a Product or Segment Is a Huge Decision That

question 81

Multiple Choice

Discontinuing a product or segment is a huge decision that must be carefully analyzed. Which of the following would be a valid reason not to discontinue an operation?

• A) Losses are minimal.
• B) Variable costs are less than revenues.
• C) Variable costs are more than revenues.
• D) Allocated fixed costs are more than revenues.

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Definitions:

VFD

Variable Frequency Drive, a type of motor controller that drives an electric motor by varying the frequency and voltage of its power supply.

Programmed Operating Parameters

Pre-set conditions and values within a system that dictate its operation, ensuring optimal performance and functionality.

VFD

A Variable Frequency Drive, a type of motor controller that drives an electric motor by varying the frequency and voltage of its power supply, optimizing motor performance.