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Exam 19: Cost-Volume-Profit Analysis

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Question 201

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

A) mixed cost
B) variable cost
C) fixed cost
D) period cost

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Question 202

Multiple Choice

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

A) mixed cost
B) variable cost
C) fixed cost
D) period cost

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Question 203

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Contribution margin is

Costs that vary in total in direct proportion to changes in an activity level are called

Which of the following is not an assumption underlying cost-volume-profit analysis?

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.

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

A company with a break-even point at $900,000 in sales revenue had fixed costs of $225,000.When actual sales were $1,000,000,variable costs were $750,000.Determine (a)the margin of safety expressed in dollars,(b)the margin of safety expressed as a percentage of sales,(c)the contribution margin ratio,and (d)the operating income.

What ratio indicates the percentage of each sales dollar that is available to cover fixed costs and to provide a profit?

Cordell,Inc.has an operating leverage of 3.Sales are expected to increase by 9% next year.What is the expected change in operating income next year?

As production increases,the fixed cost per unit

Harley Company has sales of $500,000,variable costs are 75% of sales,and operating income is $40,000.What is Harley's operating leverage?

Variable costs as a percentage of sales are equal to 100% minus the contribution margin ratio.

Cost-volume-profit analysis cannot be used if which of the following occurs?

Manley Co.manufactures office furniture.During the most productive month of the year,4,500 desks were manufactured at a total cost of $86,625.In its slowest month,the company made 1,800 desks at a cost of $49,500.Using the high-low method of cost estimation,total fixed costs are

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

If fixed costs are $600,000 and the unit contribution margin is $40,what is the break-even point if fixed costs are increased by $90,000?

Copper Hill Inc.manufactures laser printers within a relevant range of production of 70,000 to 100,000 printers per year.The following partially completed manufacturing cost schedule has been prepared: ​ ​ Complete the preceding cost schedule,identifying each cost by the appropriate letter (a)through (o).

Roller Paint Co.reported the following data for the month of September.There were no beginning inventories and all units were completed (no work in process). ​ ​ In the month of September,28,000 of the 30,000 units manufactured were sold at a price of $80 per unit.

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