The Percentage Change in Any Individual Item Shown on Comparative

question 104

Multiple Choice

The percentage change in any individual item shown on comparative financial statements is calculated by dividing the dollar amount of the change from the base period to the current period by:

• A) 100
• B) the amount shown for the current period
• C) the average of the amounts shown for the base and the current periods
• D) the base-period amount

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Definitions:

Proportional Rent

Rent expenses that fluctuate based on a predetermined factor, such as sales volume or production levels.

Fixed Costs

Costs that remain constant in total regardless of changes in levels of activity or volume of output within a certain range.

Product Dropping

The process of discontinuing a product from a company's offerings, often due to poor sales, shifting market demands or strategic realignments.

Traceable Fixed Costs

Fixed costs that can be directly linked to a specific product, service, or segment of a business.