Since a Mixed Cost Has Both a Fixed and a Variable

question 76

True/False

Since a mixed cost has both a fixed and a variable component, both the total cost and the unit cost will vary with changes in the level of activity.

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Definitions:

Percentage Change

A mathematical calculation that shows how much a quantity has increased or decreased as a percentage of its previous value.

Net Operating Income

The profit generated from normal business operations, excluding expenses from interest and taxes.

Contribution Margin Ratio

The proportion of sales revenue that exceeds variable costs, indicating how much contributes to covering fixed costs and generating profit.

Target Profit

The amount of net income a company aims to achieve for a specific period as part of its financial and operational planning.