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1. Office rent, which is a fixed cost that a company incurs for its employees, can be cheaper per user if:
A) the office is converted to a storeroom.
B) fewer employees occupy the office.
C) more employees occupy the office.
2. If an employee's compensation consists of a salary plus commissions based on sales, the employee's compensation would be what for the employer?
a) Mixed cost
b) Non-monetary reward
c) Prepaid expense
3. What do financial leverage and operating leverage have in common?
A) Both types of leverage are risk-free.
B) Both types of leverage are risky.
C) Both types of leverage are prohibited by the US government.
4. The contribution margin of a company is used for which of the following:
A) Profit after covering fixed costs
B) Fixed costs
C) Both of the other answers are correct.
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