When a Manager Talks About Cost Behavior,she Is Referring to

question 158

Multiple Choice

When a manager talks about cost behavior,she is referring to

• A)The way in which total costs change in response to changes in the level of activity.
• B)The method used to determine whether a cost is accrued or expensed.
• C)Both A and B.
• D)None of these ans choices are correct.

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Definitions:

Operating Capacity

The maximum output or the level of service that a company can achieve with its current resources under normal conditions.

Dividend Payout Ratio

A financial metric that shows what percentage of a company's earnings are distributed to shareholders as dividends.

Additional Debt

Borrowing more funds in addition to existing debt, which can increase a company's leverage and financial risk.

Operating Capacity

The maximum output that a company can produce under normal conditions within a given period using its existing resources.