Proprietary Funds Report Using Three Net Position Categories: Net Investment

question 13

True/False

Proprietary funds report using three net position categories: net investment in capital assets; restricted; and unrestricted.

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Definitions:

Fixed Costs

Expenses that do not change with the level of goods or services produced by a business.

Contribution Margin

The amount remaining from sales revenue after variable costs are deducted, indicating how much contributes to covering fixed costs and generating profit.

Pretax Income

The income earned by a business before any taxes have been deducted.

Target Pretax Income

The income a company aims to achieve before deducting taxes, often set for budgeting or goal-setting purposes.