During the current year, the net sales of Ridgeway, Inc. were 10 percent below last year's level. You should expect Ridgeway's semivariable costs to:

Question

Quizplus · Accepted Answer

Semivariable costs have both fixed and variable components. When net sales decrease, the total semivariable costs will decrease due to the reduction in the variable component. However, as a percentage of net sales, these costs will increase because the fixed component remains constant while sales have decreased.

During the Current Year, the Net Sales of Ridgeway, Inc