Asked by Ja'Nayla Watts on Jul 24, 2024

verifed

Verified

A change in sales has no effect on margin and turnover.

Margin And Turnover

Financial metrics where margin refers to the difference between sales and the cost of goods sold, and turnover involves the rate at which inventory is sold or replaced.

  • Gain insight into the impact of sales changes on margin and turnover.
verifed

Verified Answer

SS
Samuel SeyoumJul 29, 2024
Final Answer :
False
Explanation :
Sales, margin, and turnover are all interconnected. A change in sales can affect both the margin (profit per unit sold) and turnover (number of units sold). For example, an increase in sales may lead to a decrease in margin if the cost of production increases due to increased demand. Conversely, a decrease in sales may lead to an increase in margin if fixed costs can be better distributed over a reduced number of units sold.