Question: 1. What is the variable cost ratio? The contribution margin ratio? How are the two ratios related? 2. Explain the meaning of (a) differential revenue,

1. What is the variable cost ratio? The contribution margin ratio? How are the two ratios related?

2. Explain the meaning of (a) differential revenue, (b) differential cost, and (c) differential income.

3. What behavioral problems are associated with setting a budget too loosely?

4. What are the basic objectives in the use of standard costs?

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