Assuming That a Segment Has Both Variable Expenses and Traceable

question 98

True/False

Assuming that a segment has both variable expenses and traceable fixed expenses,an increase in sales should increase profits by an amount equal to the sales times the segment margin ratio.

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Definitions:

Quarterly Sales

The total revenue generated from sales within a specific three-month period in a fiscal year.

Miscellaneous Expenses

Costs that are not consistently categorized among the standard costs for operation of a business, often minor in scope and irregular in occurrence.

Rent Expense

Rent Expense is the cost incurred by a company for using a property or equipment for business operations, which is recognized on the income statement.

Continuous Budgets

Budgets that are continuously updated by adding a new budget period as the last one is completed, thus always having a full period's financial plan.