A Committed Fixed Cost Can

question 71

Multiple Choice

A committed fixed cost can

• A)never be eliminated.
• B)be eliminated in the short term and in the long term.
• C)be eliminated in the long term but not in the short term.
• D)be eliminated in the short term but not in the long term.

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Definitions:

Interest Revenue

Earnings generated by providing loans or placing money into financial vehicles that accrue interest.

Temporary Investment

Short-term investments made by a company to earn a return on idle cash without impacting its liquidity.

Long-Term Investment

Investments held for an extended period, usually more than one year, with the intention of gaining significant returns over time.

Dividends Received

Income earned from investments in the form of payments distributed by a corporation to its shareholders.