Performance Reports for Sales Departments Should Compare Actual Revenue Versus

question 38

Multiple Choice

Performance reports for sales departments should compare actual revenue versus budgeted

• A)revenue.
• B)cost.
• C)return on investment.
• D)profit.

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Definitions:

Personal Taxes

Taxes levied on individuals' income, capital gains, and other forms of personal wealth.

Operating Leverage

The extent to which fixed costs are used in a firm’s operations. If a high percentage of a firm’s total costs are fixed costs, then the firm is said to have a high degree of operating leverage. Operating leverage is a measure of one element of business risk, but does not include the second major element, sales variability.

EPS

Earnings Per Share, a key financial indicator used to measure a company's profitability on a per-share basis, reflecting the portion of a company's profit allocated to each outstanding share of common stock.

MM Model

The Modigliani and Miller theory, which proposes that under certain conditions, the value of a firm is unaffected by its capital structure.