FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 5: Cost Volume Profit Analysis

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 101

True/False

Review LaterAdd Note

Review Later

Even if a business sells six products, it is possible to estimate the break-even point.

A) True
B) False

Correct Answer

verified

Show Answer

Question 102

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) A) and B)
F) All of the above

Correct Answer

verified

Show Answer

Question 103

True/False

Review LaterAdd Note

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

If sales are $425,000, variable costs are 62% of sales, and operating income is $50,000, what is the contribution margin ratio?

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

The point in operations at which revenues and expenses are exactly equal is called the break-even point.

Costs that remain constant in total dollar amount as the level of activity changes are called

Companies with large amounts of fixed costs will generally have a high operating leverage.

If yearly insurance premiums are increased, this change in fixed costs will result in an increase in the break-even point.

A business had a margin of safety ratio of 20%, variable costs of 75% of sales, fixed costs of $240,000, a break-even point of $960,000, and operating income of $60,000 for the current year.  Calculate the current year's sales.

For the current year ending January 31, Harp Company expects fixed costs of $188,500 and a unit variable cost of $51.50. For the coming year, a new wage contract will increase the unit variable cost to $55.50. The selling price of $70.00 per unit is expected to remain the same. (a) Compute the break-even sales (units) for the current year. Round your answer to the nearest whole number. (b) Compute the anticipated break-even sales (units) for the coming year, assuming the new wage contract is signed.

If fixed costs are $750,000 and variable costs are 60% of sales, what is the break-even point in sales dollars?

As production increases, variable costs per unit

Charlotte Co. has budgeted salary increases to factory supervisors totaling 9%. If selling prices and all other cost relationships are held constant, next year's break-even point

Penny Company sells 25,000 units at $59 per unit. Variable costs are $29 per unit, and loss from operations is $(50,000). Determine: (a) unit contribution margin (b) contribution margin ratio (c) fixed costs per unit at production of 25,000 units.

Which of the following is not an example of a cost that varies in total as the number of units produced changes?

A rental cost of $20,000 plus $0.70 per machine hour of use is an example of a mixed cost.

A cost that has characteristics of both a variable cost and a fixed cost is called a

If the unit selling price is $40, the volume of sales is $3,000,000, sales at the break-even point amount to $2,500,000, and the maximum possible sales are $3,300,000, the margin of safety is 11,500 units.

Carter Co. sells two products, Arks and Bins. Last year, Carter sold 14,000 units of Arks and 56,000 units of Bins. Related data are: What was Carter Co.'s unit selling price of E, with E representing one overall "enterprise" product?