Cost Behavior Is Defined as the Manner in Which Costs

question 103

True/False

Cost behavior is defined as the manner in which costs respond to changes in volume or activity.

---

Definitions:

Debt-To-Equity Ratio

A financial ratio indicating the relative proportion of shareholders' equity and debt used to finance a company's assets.

Corporate Veil

A legal concept that separates the personality of a corporation from the personalities of its shareholders, and protects them from being personally liable for the company's debts and obligations.

Thin Capitalization

In corporation law, a ground for piercing the corporate veil due to the shareholders’ contributing too little capital to the corporation in relation to its needs.

Nevada Corporation

A corporation chartered in the state of Nevada, often chosen for its favorable corporate laws and tax rules.