If Sales Amounted to $300,000, Variable Costs Are 60% of Sales

question 65

Multiple Choice

If sales amounted to $300,000, variable costs are 60% of sales, and operating income is $40,000, what is the operating leverage?

• A) 3.000
• B) 7.500
• C) 1.875
• D) 4.500

Compute the impact of inventory transactions on consolidated financial statements.

Account for impairment losses on goodwill.

Prepare and adjust the investment account under the equity method.

Understand the process and significance of preparing consolidated financial statements.

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Definitions:

Mirror Neurons

Neurons that fire both when an individual acts and when the individual observes the same action performed by another, thought to be related to understanding actions, empathy, and learning through imitation.

Emotions

Complex psychological states involving thoughts, feelings, physiological changes, and behaviors in response to stimuli.

Extinction

In behavioral psychology, the process by which a previously learned behavior is reduced and eventually disappears when reinforcement is no longer provided.

Reinforcement

In behavioral psychology, a concept that involves increasing the likelihood of a behavior by following it with a positive or removing a negative stimulus.