Which of the Following Statements Is Not True

question 49

Multiple Choice

Which of the following statements is not true?

• A)Over the short run, unit variable costs remain constant.
• B)Over the short run, fixed costs decrease as sales volume decreases.
• C)Variable costs are proportional to sales volume.
• D)Contribution margin is calculated by subtracting variable costs from revenue.
• E)None of the above.

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Definitions:

Income Statement

A financial statement that reports a company's financial performance over a specific accounting period, detailing revenues, expenses, and profits or losses.

Macro-aging Schedule

A method used in accounting to categorize accounts receivable or payables based on the length of time they have been outstanding.

Accounts Receivable

Money owed to a business by its customers for goods or services that have been delivered but not yet paid for.

Average Collection Period

The average number of days it takes for a company to receive payments owed by its customers for sales on credit.