FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 4: Cost Behavior and Cost-Volume-Profit Analysis

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 1

True/False

Review LaterAdd Note

Review Later

Rental charges of $40,000 per year plus $3 for each machine hour over 18,000 hours is an example of a fixed cost.

A) True
B) False

Correct Answer

verified

Show Answer

Question 2

Multiple Choice

Review LaterAdd Note

Review Later

If a business had sales of $4,000,000 and a margin of safety of 25%, the break-even point was:

A) $5,000,000
B) $3,000,000
C) $12,000,000
D) $1,000,000

E) B) and C)
F) A) and D)

Correct Answer

verified

Show Answer

Question 3

True/False

Review LaterAdd Note

A mixed cost has characteristics of both a variable and a fixed cost.

If sales total $2,000,000, fixed costs total $800,000, and variable costs are 60% of sales, the contribution margin ratio is 40%.

If fixed costs are $256,000, the unit selling price is $36, and the unit variable costs are $20, what is the break-even sales (units) ?

If variable costs per unit decreased because of a decrease in utility rates, the break-even point would:

If fixed costs are $300,000, the unit selling price is $31, and the unit variable costs are $22, what is the break-even sales (units) if fixed costs are reduced by $30,000?

Direct materials and direct labor costs are examples of variable costs of production.

If employees accept a wage contract that increases the unit contribution margin, the break-even point will decrease.

Given the following cost data, what type of cost is shown?

For purposes of analysis, mixed costs can generally be separated into their variable and fixed components.

Mia Enterprises sells a product for $90 per unit. The variable cost is $40 per unit, while fixed costs are $75,000. Determine the (a) break-even point in sales units, and (b) break-even point in sales units if the selling price increased to $100 per unit.

If fixed costs are $46,800, the unit selling price is $42, and the unit variable costs are $24, what is the break-even sales (unit ) if the variable costs are decreased by $2?

Contribution margin is:

As production increases, what should happen to the variable costs per unit?

Rusty Co. sells two products, X and Y. Last year Rusty sold 5,000 units of X's and 35,000 units of Y's. Related data are: What was Rusty Co.'s sales mix last year?

Unit variable cost does not change as the number of units of activity changes.

If fixed costs are $1,200,000, the unit selling price is $240, and the unit variable costs are $110, what is the amount of sales required to realize an operating income of $200,000?

Absorption costing is required for financial reporting under generally accepted accounting principles.

Cool-It Company manufactures and sells commercial air conditioners. Because of current trends, it expects to increase sales by 10 percent next year. If this expected level of production and sales occurs and plant expansion is not needed, how should this increase affect next year's total amounts for the following costs. Variable Costs Fixed Costs Mixed Costs