Exam 21: Cost Behavior and Decisions Using C-V-P Analysis

The following data is available for North Publishers and South Publishers: What will be the profit or loss for each company if the sales level drops to 5,500 units?

Star of the Sea School has annual fixed costs of $150,000 and variable costs of $550 per student. Star of the Sea expects 345 students for the upcoming year. If the school wishes to earn a profit of $10,000, what should tuition per student be?

When other factors remain constant, an increase in variable costs:

Duke Corporation sells fans for $20 per unit. In 2011, fixed costs are expected to be $450,000, and the variable cost ratio is 60%. How many fans must Duke sell to generate operating income of $60,000?

Within the relevant range, per-unit variable cost:

Maintaining low fixed costs and high variable costs rather than high fixed costs and low variable costs:

Challis Company had sales of $450,000 and a profit of $54,000 during the period. Assume the fixed costs for the period were $184,500. The contribution margin ratio for the period was:

Given the equation $500X = $300X + $200,000, variable costs are:

Exhibit 21-8 Use the profit graph below to answer the following question(s). -Refer to Exhibit 21-8. Area B on the profit graph represents the:

The relevant range refers to the activity range over which:

Stone Company plans to sell 200,000 calculators. The fixed costs are $600,000, and the variable costs are 60% of the selling price. If the company wants to realize a profit of $120,000, the selling price of each calculator must be:

Fixed costs per unit:

C-V-P analysis is useful to managers in:

To reach a target income of $20,000, a firm with fixed costs of $10,000 and a per-unit contribution margin of $5 must sell:

As compared to a company with a low operating leverage, a company with a high operating leverage will:

A graph that only plots profits and losses, and omits costs and revenues, is called a:

Assume that Upward Company has total variable costs of $90,000 when 30,000 units are sold. If 40,000 units were sold, total variable costs would be:

The limiting assumptions of C-V-P analysis include all of the following, EXCEPT:

Increasing the selling price and decreasing sales volume will increase profit if:

Heyburn Company had the following income statement: Given this data, Heyburn Company's per-unit contribution margin is: