In Cost-Volume-Profit (CVP) analysis, 'Angle of Incidence' represents: MCQ with Answer and Explanation

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In Cost-Volume-Profit (CVP) analysis, 'Angle of Incidence' represents:

A. The percentage of variable cost to sales

B. The angle between total sales line and total cost line above the BEP

C. The point of zero profit

D. The angle of the fixed cost line

Answer: Option B

Solution (By JKExamLibrary)

A wider angle of incidence on a break-even chart indicates a higher rate of profit generation once the break-even point is crossed.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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The journal entry for transferring 'Net Profit' to capital account is:

A. Capital A/c Dr. To Profit & Loss A/c

B. Drawings A/c Dr. To Capital A/c

C. Profit & Loss A/c Dr. To Capital A/c

D. Profit & Loss Appropriation A/c Dr. To Capital A/c

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Correct Answer: Option C

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The 'Earnings Before Interest, Tax, Depreciation and Amortisation' (EBITDA) is a measure of:

A. Cash flow from investing

B. Liquidity

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D. Operating profitability

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Correct Answer: Option D

Explanation:
EBITDA focuses on operational performance before non-cash items and capital structure.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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The 'Audit Risk' is composed of:

A. Inherent risk, control risk, detection risk

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