As the Volume of Output Decrease

question 86

Multiple Choice

As the volume of output decrease:

• A)Fixed costs per unit will increase.
• B)Fixed costs per unit will decrease.
• C)Fixed costs per unit will not change.
• D)Fixed costs in total will decrease.

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Definitions:

Expense

Money spent or cost incurred in an entity's efforts to generate revenue, representing the cost of doing business.

Trial Balance

An accounting report that lists the balances of all general ledger accounts at a particular point in time to check the accuracy of bookkeeping entries.

Income Statement

A financial statement that shows a company's revenues, expenses, and profit over a specific period.

Retained Earnings

The portion of a company’s profits that is retained within the business rather than distributed to shareholders as dividends.