Senior Executives Do Not Need to Understand the Balance Sheet

question 25

True/False

Senior executives do not need to understand the balance sheet and the income statement, only financial and accounting departments need to have this understanding.

---

Definitions:

Variable Costs

Costs that vary in total dollar amount as the level of activity changes.

Short-Run Price

The price level of goods or services in a market that is determined over a short period, where some costs can be considered fixed.

Special Price

A discounted rate offered for a product or service outside of its standard pricing.

Differential Cost

The difference in total cost that will result from selecting one alternative over another in decision-making processes.