In Performing a Vertical Analysis, a 10% Increase in Net

question 35

Multiple Choice

In performing a vertical analysis, a 10% increase in net sales combined with an 8% increase in total expenses will cause profit to

• A) increase by 10%.
• B) decrease by 10%.
• C) increase by 2%.
• D) decrease by 2%.

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Definitions:

Material Fact

Any fact that could influence a party's decision to enter into a contract or transaction; important information that should not be misrepresented or withheld.

Legal Duty

An obligation recognized by law, requiring an individual or entity to conform to a certain standard of conduct for the protection of others.

Negligence

A failure to behave with the level of care that someone of ordinary prudence would have exercised under the same circumstances, often leading to harm or damage.

Breached

The act of failing to fulfill the terms of a contract, agreement, or duty.