Contribution margin is divided to operate income to calculate
A. degree of operating leverage
B. degree of change
C. degree of change in margin
D. degree of change in income
Answer: Option A
Solution(By Examveda Team)
Contribution margin is divided to operate income to calculate degree of operating leverage. The Degree of Operating Leverage (DOL) is the leverage ratio that sums up the effect of an amount of operating leverage on the company's earnings before interests and taxes (EBIT).Related Questions on Management Accounting
A. resourcing
B. value acquiring
C. production
D. value acquaintance
Examining of past performance, exploring alternative and planning future is
A. learning
B. alternating
C. examining
D. deciding
Time that a company takes to create and produce a new product is classified as
A. management factor
B. time factor
C. customer factor
D. chain factor
Purpose of management accounting is to
A. past orientation
B. help banks make decisions
C. help managers make decisions
D. help investors make decision
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