(Appendix 11A)The Contribution Margin Sales Volume Variance Calculates

question 30

Multiple Choice

(Appendix 11A) The contribution margin sales volume variance calculates:

• A)The effects of changes in contribution margins, given the actual level of sales
• B)The effects of changes in units sold, given the standard contribution margins
• C)The effects of changes in actual fixed costs, given the actual level of sales
• D)The effects of changes in standard variable costs, given the actual level of sales

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Definitions:

Sustainable Growth Rate

The maximum rate at which a company can grow its sales, earnings, and dividends without increasing debt or equity financing.

Debt Ratio

A financial ratio that measures the extent of a company's or individual's leverage, calculated by dividing total liabilities by total assets.

Selling And Administrative Expenses

Combined costs related to the selling of products and the administration of a business, excluding production costs.

Retention Ratio

The proportion of net income that is retained in the business rather than paid out to shareholders as dividends, indicating the amount reinvested in the company.