Discontinuing a Product or Segment Is a Huge Decision That

question 33

Multiple Choice

Discontinuing a product or segment is a huge decision that must be carefully analyzed.Which of the following would be a valid reason not to discontinue an operation?

• A) losses are minimal
• B) variable costs are less than revenues
• C) variable costs are more than revenues
• D) allocated fixed costs are more than revenues

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Definitions:

Employee Motivation

The techniques and strategies employed by businesses to encourage their employees to perform their best and remain engaged and satisfied with their work.

Budgeting

The process of creating a plan to spend your money, which involves estimating revenues and outlining planned expenditures.

Merchandise Purchases Budget

A financial plan that estimates the amount of inventory a company needs to buy to meet sales needs for a future period.

Sales Budget

A detailed plan that outlines projected sales for a future period, taking into account factors like marketing strategies and market conditions.