Responsibility Margin Is Useful in Evaluating the Consequences of Short-Run

question 85

True/False

Responsibility margin is useful in evaluating the consequences of short-run marketing strategies,while contribution margin is more useful in evaluating long-term profitability.

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Definitions:

Derivatives

Financial securities whose value is derived from the value of an underlying asset or benchmark.

AASB 9

The Australian Accounting Standards Board standard covering the classification, measurement, and recognition of financial assets and financial liabilities.

Business Model Test

The asset is held within a business model whose objective is to hold assets in order to collect contractual cash flows.

Cash Flows Characteristics Test

The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest.