Measuring Assets at Current Costs Will Result in Different ROIs

question 62

Multiple Choice

Measuring assets at current costs will result in different ROIs compared to the ROIs calculated on the basis of ________.

• A)past cost
• B)future cost
• C)current cost
• D)historical cost
• E)suboptimal cost

---

Definitions:

Break-Even Point

The point at which total costs and total revenue are equal, resulting in neither profit nor loss.

Fixed Costs

Expenses that do not change with the volume of production or sales, such as rent, salaries, and insurance.

Variable Cost

A cost that varies with the level of output or activity, in contrast to fixed costs, which remain constant regardless of activity.

Fixed Costs

Expenses that do not change with changes in the volume of production or sales, such as rent, salaries, and insurance.