The Fixed Cost Per Unit Does Not Always Remain the Same

question 165

True/False

The fixed cost per unit does not always remain the same.

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Definitions:

Market-to-Book Ratio

The market-to-book ratio compares a company's market value (or capitalization) to its book value of equity, indicating how valued a company is in comparison to its accounting values.

Debt-Equity Ratio

The debt-equity ratio shows the comparative amount of shareholder equity and debt financing a company uses to support its assets.

Fully Depreciated

A state where a fixed asset has reached the end of its useful life and its book value is reduced to scrap value.

Profit Margin

A measure of a company's profitability, calculated by dividing net income by total revenues. It shows how much profit each dollar of sales generates.