Which Method of Deferred Income Has Most Increased in Use

question 50

Multiple Choice

Which method of deferred income has most increased in use in recent years?

• A) Deferred wage rate increases
• B) COLAs
• C) Lump-sum payments
• D) Two-tier pay plans

---

Definitions:

Variable Expenses

Expenses that vary directly with the level of production or sales volume, such as raw materials and direct labor.

Fixed Expenses

Costs that remain constant over a specified period regardless of changes in the level of activity or volume of production.

Margin of Safety

The difference between actual or expected sales and the sales level at the break-even point, indicating the amount by which sales can drop before the company incurs a loss.

Unit Variable Expenses

Costs that vary directly with the volume of production or sales per unit.