1. Why do higher marketing variable costs not increase total variable costs on the income statement?
A. Marketing costs are considered period costs on the income statement
B. Promotion and Sales budget have a small effect on variable costs
C. Marketing forecasts are not related to the proforma income statement
D. None of the above
2. Which financial ratio is used to determine what rate of return the company is producing wealth for its owners?
A. Return on Sales
B. Return on Assets
C. Days of Working Capital
D. Return on Equity