Operating Leverage Measures

question 115

Multiple Choice

Operating leverage measures:

• A) how sensitive profit is to a change in fixed costs.
• B) how sensitive profit is to a change in sales volume.
• C) how sensitive profit is to a change in sales price per unit.
• D) how sensitive profit is to a change in tax rates.

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Definitions:

No-swivel Chairs

Chairs designed without a rotating mechanism, limiting their ability to turn or pivot.

Daily Basis

A timeframe or scheduling period where actions or activities are performed on a day-to-day basis.

Fabricating Department

A section within a manufacturing company where raw materials are transformed into components or products through various processes like cutting, welding, and assembly.

Production Requirements

The specific criteria or conditions needed to manufacture or produce goods, including materials, labor, and technology.