Chapter21 Question and answers already passed 2024/2025
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Course
ACCT
Institution
ACCT
Chapter21 Question and answers already passed 2024/2025 Chapter 5: CONNECT HW
A firm must first determine the amount of which types of costs to be used in the production process. - correct answer fixed costs
During an economic upturn, when a firm's sales volume is high, a firm that has hig...
Chapter 5: CONNECT HW
A firm must first determine the amount of which types of costs to be used in
the production process. - correct answer ✔fixed costs
During an economic upturn, when a firm's sales volume is high, a firm that has
high fixed costs may ______? - correct answer ✔incur a greater percentage
of profit than a firm with high variable costs
The firm can finance the business using ______? - correct answer ✔debt
and equity
A firm that is unable to make its debt payments may be subject to ______. -
correct answer ✔bankruptcy
Financial leverage ______ - correct answer ✔may increase a company's
return on equity
The production process requires that management determine the amount of
______ to be used. - correct answer ✔labor
plant and equipment
During an economic downturn, when a firm's sales volume is low, a firm that
has high variable costs may ______. - correct answer ✔lower its exposure to
risk.
The extent with which fixed costs are used in the operations of the firm is
known as - correct answer ✔operating leverage
, Debt and equity are methods used to - correct answer ✔finance a business.
Firms that rely on equity financing will - correct answer ✔lower their profit
potential.
minimize their risk exposure.
Operating leverage is defined as the - correct answer ✔extent to which fixed
assets and associated fixed costs are used in the business
Leverage looks at - correct answer ✔how long term debt is used to finance
the business
All of the following are considered fixed costs except - correct answer
✔factory labor
The extent with which debt is utilized in the firm is known as - correct answer
✔financial leverage
______ leverage reflects the extent to which fixed assets and associated fixed
costs are utilized in the business. - correct answer ✔Operating
Semi-variable costs ______ as the number of units produced increases. -
correct answer ✔increase
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