As the Level of Activity Increases,the Fixed Cost Per Unit

question 58

Multiple Choice

As the level of activity increases,the fixed cost per unit of activity

• A) increases.
• B) decreases.
• C) does not change.
• D) may increase or decrease.

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Definitions:

Adoption

In corporation law, a corporation’s acceptance of a preincorporation contract by action of its board of directors, by which the corporation becomes liable on the contract.

Novation

The act of replacing one obligation with a new one, extinguishing the original obligation.

Ratification

Ratification is the formal approval or confirmation of an action or agreement, often used in the context of treaties, contracts, or laws.

Promoters

Individuals or companies responsible for establishing a corporation or business venture, including raising capital and completing legal formalities.