When Other Factors Remain Constant, an Increase in Average Total

question 57

Multiple Choice

When other factors remain constant, an increase in average total assets:

• A) Increases the return on investment
• B) Decreases the return on investment
• C) Does not change the return on investment
• D) Does not always have the same effect on total assets

---

Definitions:

Direct Labor-Hours

A measure representing the total hours worked by employees directly involved in the production of goods or services.

Unit Product Cost

Unit product cost is the total expense incurred to produce, store, and sell one unit of a product.

Overhead Applied

The allocation of overhead costs to specific jobs or production units based on a predetermined rate or method.

Activity-Based Costing

A methodology in costing that spots activities within an organization and distributes the costs related to each activity across all products and services, adhering to the genuine use by each.