Choose the Word or Phrase in [ ] Which Will

question 67

Short Answer

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement.
-When purchasing a long-term care policy,the [guaranteed renewability | optional renewability] provision is recommended.

Understand and apply the concept of contribution margin (CM) ratio in decision making.

Calculate sales units required to maintain net operating income when certain cost parameters change.

Understand the concept of operating leverage and its impact on profits with a change in sales volume.

Analyze the effect of sales mix on break-even and target profit points.

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Definitions:

JIT Systems

Inventory management systems that seek to minimize inventory levels by scheduling material arrivals only when they are needed in the manufacturing process.

Environmental Risk

The potential for environmental damage or adverse health effects resulting from exposure to environmental hazards or pollutants.

Control Risk

The risk that errors or irregularities in financial statements will not be prevented, or detected and corrected, by an organization's internal controls.

Supply-Chain Leverage

The strategic use of supply chain processes and partnerships to gain competitive advantage in cost, speed, or innovation.