The Operating Leverage Factor Indicates the Percentage Change in Operating

question 110

True/False

The operating leverage factor indicates the percentage change in operating income that will occur from a 1% change in volume.

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Definitions:

Creditor

An entity (person or institution) that extends credit by lending money or extending credit lines, to which a debtor owes repayment.

Net Worth

The total assets minus total liabilities of an individual or company, representing the owner's equity.

Future Benefit

An economic advantage or return that is expected to be received in the future as a result of current or past actions.

Asset

A resource with economic value that an individual, corporation, or country owns or controls with the expectation that it will provide future benefit.