Why does the presence of fixed costs cause the percent-of-sales method of pro forma income statement preparation

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Why does the presence of fixed costs cause the percent-of-sales method of pro forma income statement preparation to fail? What is a better method?

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Principles Of Managerial Finance

ISBN: 978-0136119463

13th Edition

Authors: Lawrence J. Gitman, Chad J. Zutter

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Question Posted: Mar 05, 2012 04:48 AM

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Why does the presence of fixed costs cause the percent-of-sales method of pro forma income statement preparation

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Due to the effect of leverage ignoring fixed costs tend...View the full answer

Principles Of Managerial Finance

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