If Direct Materials Cost Per Unit Decreases, the Amount of Sales

question 121

True/False

If direct materials cost per unit decreases, the amount of sales necessary to earn a desired amount of profit will decrease.

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Definitions:

Calculate Interest

Determining the cost of borrowing money or the profit from lending money, based on the principal sum, rate, and time.

Adjustment

An accounting entry made into a journal that is used to record changes in account balances.

Financial Statement

A formal record of the financial activities and position of a business, person, or other entity, presenting the financial results over a specific period.

Normal Balance

The side (debit or credit) of an account on which increases to the account are recorded, depending on the account type.