Question: When a company has high operating leverage: Select one: A . It has low fixed costs. B . It borrows to cover most costs. C

When a company has high operating leverage:
Select one:
A. It has low fixed costs.
B. It borrows to cover most costs.
C. It has high fixed costs relative to variable costs.
D. It has high variable costs relative to fixed costs.
E. None of the above
When a company has high operating leverage: Select one: A. It

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!

Q:

When a company has high operating leverage: Select one: O A. It has low fixed costs. B. It borrows to cover most costs. C. It has high fixed costs relative to variable costs. D. It has high variable...

Q:

A firm with high operating leverage has: Group of answer choices low fixed costs in its production process. high variable costs in its production process. high fixed costs in its production process....

Q:

On a graph of sales revenue and costs, the fixed cost line is drawn from the point of intersection of the horizontal and vertical axes upward and to the right. Group of answer choices True False If a...

Q:

On a graph of sales revenue and costs, the fixed cost line is drawn from the point of intersection of the horizontal and vertical axes upward and to the right. Group of answer choices True False If a...

Q:

35. Which statement about operating leverage is true? A. Companies with low fixed costs have high operating leverage. B. Companies with low fixed costs have low operating leverage. C. Companies that...

Q:

High operating leverage means: (1) The company has relatively low fixed costs. (2) The company has relatively high fixed costs. (3) The company will have to sell more units than a comparable company...

Q:

10. A firm with high operating leverage has: low costs per unit. high fixed costs in its production process. high variable costs in its production process. low fixed costs in its production process....

Q:

A firm with high operating leverage has: high price per unit. high fixed costs in its production process. high variable costs in its production process. low price per unit. low fixed costs in its...

Q:

what comment can I make about A company with high operating leverage faces greater financial risk in a declining sales period because it has a higher proportion of fixed costs to variable costs. This...

Q:

Please show work if correct will rate 5. Insurit offers 2 types of window coverings- automobile and home. For every home window covering sold, Insurity typically sells 4 auto window coverings....

Q:

A 20-g bead is attached to a light 120 cm-long string as shown in the figure. If the angle is measured to be 18, what is the speed of the mass?

Q:

A refrigerator has a COP of 1.5. That is, the refrigerator removes 1.5 kWh of energy from the refrigerated space for each 1 kWh of electricity it consumes. Is this a violation of the first law of...

Q:

Bond issuers benefit from placing restricting covenants because by doing so they can obtain a higher interest rate. B . Bondholders benefit from restricting covenants because they can obtain a lower...

Q:

A penetration test agreement is very important to ensure that both parties, the penetration tester and the client ( your company ) , understand the purpose and scope of the penetration test.