When fixed costs are included in the cost of goods sold, the gross margin percentage should increase and decrease with sales volume.

Name: When fixed costs are included in the cost of goods sold, the gross margin percentage should increase and decrease with sales volume.
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Question

Quizplus · Accepted Answer

When fixed costs are included in the cost of goods sold, the gross margin percentage will decrease with sales volume because the fixed costs are spread over a larger number of units sold.

When Fixed Costs Are Included in the Cost of Goods