Select the correct statement from the following.
A. A fixed cost structure offers less risk (i.e., less earnings volatility) and higher opportunity for profitability than does a variable cost structure.
B. A fixed cost structure offers greater risk but higher opportunity for profitability than does a variable cost structure.
C. A variable cost structure offers less risk and higher opportunity for profitability than does a fixed cost structure.
D. A variable cost structure offers greater risk but higher opportunity for profitability than does a fixed cost structure.
Answer: B
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Which of the following statements regarding the sale of a partnership interest is false?
A. The selling partner determines the gain or loss as the difference between the amount realized and her outside basis in the partnership. B. Hot assets change the character of a gain on the sale from ordinary income to capital gain. C. Any debt relief increases the amount the partner realizes from the sale. D. The seller's primary tax concern in a partnership interest sale is calculating the amount and character of gain or loss on the sale.
Paid-in capital may originate from real estate donated to the corporation
Indicate whether the statement is true or false
If a firm's board of directors wants to maximize value for its stockholders in general (as opposed to some specific stockholders), it should design an executive compensation system whose focus is on the firm's long-term value.
Answer the following statement true (T) or false (F)
Sales made and actual cash received may differ for any particular month. However, sales and cash received must be equal for a calendar year
Indicate whether the statement is true or false.