In the Decision to Drop a Product Line, Fixed Costs

question 64

Multiple Choice

In the decision to drop a product line, fixed costs are often classified as:

• A) Avoidable or sunk
• B) Sunk or opportunity
• C) Product or period
• D) Incremental or avoidable

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Definitions:

Certificate of Deposit

A savings certificate with a fixed maturity date and specified fixed interest rate, often issued by banks.

Promissory Note

A financial document in which one party (the maker) promises to pay another party (the bearer) a definite sum of money, either on a specific date or upon demand.

Indorsement

An alternative spelling for endorsement; the act of signing one's name on a document to validate it or transfer its ownership.

Tort of Conversion

A legal term referring to the wrongful possession or use of property without permission, effectively converting it from the owner's possession to the wrongdoer's.