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Which Statement Is True

question 98

Multiple Choice

Which statement is true?


Definitions:

Operating Income

Represents the amount of profit realized from a business's operations, after deducting operating expenses such as wages, depreciation, and cost of goods sold from gross revenue.

Unit Selling Price

The price at which a single unit of a product is sold to customers.

Unit Variable Costs

The costs that vary directly with the volume of production or sales, such as materials and labor.

Contribution Margin Ratio

The percentage of sales revenue that exceeds variable costs, indicating the portion available to cover fixed costs and generate profit.

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