Which of the Following Statement/s Is/are Correct

question 1

Multiple Choice

Which of the following statement/s is/are correct?

• A) Absorption costing is required by the Australian accounting standards.
• B) Variable costing records are more useful than absorption costing records for management decision making.
• C) Firms that are required to comply with the accounting standards are likely to use variable costing if the benefits of keeping a second set of records exceed the costs.
• D) All of the given answers.

Understand the allocation of common fixed expenses among divisions.

Understand the importance and impact of sales mix on total profits and break-even points.

Comprehend the role of contribution margin ratio and contribution margin per unit in determining net operating income and break-even points.

Analyze the effects of changes in fixed and variable expenses on break-even points and overall financial performance.

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Definitions:

Sales Messages

Promotional messages that encourage potential buyers to make a purchase decision then and there.

Selling Points

The most attractive features of a product or service.

Benefits

Advantages or positive outcomes that result from a particular action, policy, product, or service.

Measured Response

A carefully considered and calculated reaction to a situation, often aiming to avoid excessive or insufficient action.