If Unit Variable Cost Is Reduced and Selling Price and Fixed

question 84

Multiple Choice

If unit variable cost is reduced and selling price and fixed cost remain the same, then:

• A)Contribution margin will decrease.
• B)Contribution margin will remain the same.
• C)Sales volume will increase
• D)Sales volume will decrease.
• E)Overall profit will increase.

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Definitions:

Measurement (Cost) Principle

An accounting principle that states assets and liabilities should be recorded at their original cost and factually supported values.

Acquired Building

A building that has been purchased or obtained by a company or organization through purchase or other means of acquisition.

Appraised

The act of determining the value of an asset, typically by a professional appraiser, based on its characteristics and the market conditions.

Malpractice

Failure by a professional to meet the standards of conduct, performance, or ethics in their job, often resulting in harm to clients or patients.