A Factor That Causes the Cost of an Activity to Go

question 54

Multiple Choice

A factor that causes the cost of an activity to go up or down is a(n) :

• A) Contribution factor.
• B) Cost driver.
• C) Direct factor.
• D) Indirect factor.
• E) Product cost.

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Definitions:

Stockholder's Earnings

Also known as earnings available for shareholders, it's the portion of a company's profit allocated to each outstanding share of common stock.

Warrants

Financial derivatives that give the holder the right, but not the obligation, to buy or sell a stock at a specified price before the expiry date.

Dilute

To dilute means to make a company's shares less valuable by increasing the total number of shares, often through issuing new shares during fundraising.

Conversion Ratio

The specific number of shares that can be obtained by converting a convertible security like a bond or preferred stock into common stock.