Figure 3-2 a Company Usually Processes 20,000 Orders at a Total

question 175

Multiple Choice

Figure 3-2 A company usually processes 20,000 orders at a total cost of $300,000. During the year, only 16,000 orders were processed.
Refer to Figure 3-2. What is the cost of resource usage?

• A) $300,000
• B) $240,000
• C) $30
• D) $60,000

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Definitions:

AAA Credit Rating

The highest credit rating assigned to a borrower's debt instruments by credit rating agencies, indicating an extremely low risk of default.

A Credit Rating

This is an evaluation of the credit risk of a prospective debtor, predicting their ability to pay back the debt and an implicit forecast of the likelihood of the debtor defaulting.

Note

Unsecured debt, usually with a maturity under 10 years.

Protective Covenant

A clause in a financial contract that restricts certain actions of the borrower to protect the lender's interests.