Calculate the Ratio of Variable-Costs-To-Sales for a Firm With: $3,000,000

question 69

Multiple Choice

Calculate the ratio of variable-costs-to-sales for a firm with: $3,000,000 accounting break-even revenues, $1.2 million fixed costs, and $450,000 depreciation.(use the values in dollar)

• A)40 percent
• B)45 percent
• C)55 percent
• D)60 percent

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Definitions:

Liabilities

Financial obligations or debts of a business that arise during the course of its operations, required to be settled over time.

Owner's Equity

The residual interest in the assets of an entity after deducting liabilities, representing the capital owned by the shareholders or owner.

Cash Budget

A budget of estimated cash receipts and payments.

Balance Sheet

A financial statement that summarizes a company's assets, liabilities, and shareholders' equity at a specific point in time, providing a basis for computing rates of return and evaluating its capital structure.