Gandee Company has an operating leverage factor of 5. Which of the following statements is true? Thus, an 8% change in ______ should result in a 40% change in _____. The respective amounts that change are:
A. An 8% change in variable costs should result in a 40% change in contribution margin.
B. An 8% change in income should result in a 40% change in sales revenue.
C. An 8% change in sales revenue should result in a 40% change in income.
D. An 8% change in variable costs should result in a 40% change in break-even sales.
E. An 8% change in fixed costs should result in a 40% change in income.
Answer: C
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The adjusting entry to reflect inventory shrinkage is a debit to Cost of Goods Sold and a credit to Merchandise Inventory.
Answer the following statement true (T) or false (F)
Randy White is the executive director of a non-profit preschool for special needs children. Part of Randy's responsibilities include fundraising for the preschool. Because of his experience and success in operating specialty pre-schools, Randy is sought after as a consultant at locations around the country to assist in the start-up and operation of such facilities. Randy does so quite frequently
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