Question 1

Cost behavior refers to the manner in which

Accepted Answer

A) a cost changes as the related activity changes 
B) a cost is allocated to products 
C) a cost is used in setting selling prices 
D) a cost is estimated 
A) a cost changes as the related activity changes 
B) a cost is allocated to products 
C) a cost is used in setting selling prices 
D) a cost is estimated

Question 2

a If Swannanoa Company's budgeted sales are $1,000,000, fixed costs are $350,000, and variable costs are $600,000, what is the budgeted contribution margin ratio?
b If the contribution margin ratio is 30%, sales are $900,000, and fixed costs are $200,000, what is the operating income?

Accepted Answer

a Contribution margin = $1,000

Question 3

Cost behavior refers to the manner in which a cost changes as the related activity changes.

Accepted Answer

A) True 
 B)False

Question 4

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

Accepted Answer

A) $1,250,000 
B) $450,000 
C) $1,875,000 
D) $300,000 
A) $1,250,000 
B) $450,000 
C) $1,875,000 
D) $300,000

Question 5

If a business had a capacity of $10,000,000 of sales, actual sales of $6,000,000, break-even sales of $4,200,000, fixed costs of $1,800,000, and variable costs of 60% of sales, what is the margin of safety expressed as a percentage of sales?

Accepted Answer

Margin of Safety = S

Question 6

Which of the following conditions would cause the break-even point to decrease?

Accepted Answer

A) total fixed costs increase 
B) unit selling price decreases 
C) unit variable cost decreases 
D) unit variable cost increases 
A) total fixed costs increase 
B) unit selling price decreases 
C) unit variable cost decreases 
D) unit variable cost increases

Question 7

If the property tax rates are increased, this change in fixed costs will result in a decrease in the break-even point.

Accepted Answer

A) True 
 B)False

Question 8

Match the following terms with their definitions.
-The excess of sales revenues over variable costs

Accepted Answer

A) 	Relevant range 
B) 	Break-even point 
C) 	Contribution margin 
D) 	Fixed costs 
E) 	Variable costs 
A) 	Relevant range 
B) 	Break-even point 
C) 	Contribution margin 
D) 	Fixed costs 
E) 	Variable costs

Question 9

Safari Co.sells two products, Orks and Zins.Last year, Safari sold 21,000 units of Orks and 14,000 units of Zins.Related data are
   Calculate the following: 
a.Safari Co.'s sales mix
b.Safari Co.'s unit selling price of E?
c.Safari Co.'s unit contribution margin of E?
d.Safari Co.'s break­even point assuming that last year's fixed costs were $160,000.

Accepted Answer

a.Orks: 21,000/21,000 + 14,000

Question 10

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

Accepted Answer

A) electricity per KWH to operate factory equipment 
B) direct materials cost 
C) straight-line depreciation on factory equipment 
D) wages of assembly worker 
A) electricity per KWH to operate factory equipment 
B) direct materials cost 
C) straight-line depreciation on factory equipment 
D) wages of assembly worker

Question 11

Flying Cloud Co.has the following operating data for its manufacturing operations:   The company has decided to increase the wages of hourly workers which will increase the unit variable cost by 10%.Increases in the salaries of factory supervisors and property taxes for the factory will increase fixed costs by 4%.If sales prices are held constant, the next break-even point for Flying Cloud Co.will be

Accepted Answer

A) increased by 640 units 
B) increased by 400 units 
C) decreased by 640 units 
D) increased by 800 units 
A) increased by 640 units 
B) increased by 400 units 
C) decreased by 640 units 
D) increased by 800 units

Question 12

The relevant range is useful for analyzing cost behavior for management decision-making purposes.

Accepted Answer

A) True 
 B)False

Question 13

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

Accepted Answer

A) True 
 B)False

Question 14

As production increases, the fixed cost per unit

Accepted Answer

A) increases 
B) decreases 
C) remains the same 
D) either increases or decreases, depending on the variable costs 
A) increases 
B) decreases 
C) remains the same 
D) either increases or decreases, depending on the variable costs

Question 15

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

Accepted Answer

A) will decrease by 9% 
B) will increase by 9% 
C) cannot be determined from the data given 
D) will increase at a rate greater than 9% 
A) will decrease by 9% 
B) will increase by 9% 
C) cannot be determined from the data given 
D) will increase at a rate greater than 9%

Question 16

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

Accepted Answer

A) fixed costs 
B) sunk costs 
C) variable costs 
D) differential costs 
A) fixed costs 
B) sunk costs 
C) variable costs 
D) differential costs

Question 17

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

Accepted Answer

A) True 
 B)False

Question 18

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

Accepted Answer

A) True 
 B)False

Question 19

The manufacturing cost of Calico Industries for three months of the year are provided below:   Using the high-low method, the variable cost per unit and the total fixed costs are

Accepted Answer

A) $0.78 per unit and $4,000 
B) $0.40 per unit and $8,000 
C) $4.00 per unit and $800 
D) $7.80 per unit and $4,000 
A) $0.78 per unit and $4,000 
B) $0.40 per unit and $8,000 
C) $4.00 per unit and $800 
D) $7.80 per unit and $4,000

Question 20

Given the following information:
Variable cost per unit = $5.00 July fixed cost per unit = $7.00
Units sold and produced in July = 28,000
What is total estimated cost for August if 30,000 units are projected to be produced and sold?

Accepted Answer

The answer of Given the following information:
Variable cost per unit...

Cost behavior refers to the manner in which

a If Swannanoa Company's budgeted sales are $1,000,000, fixed costs are $350,000, and variable costs are $600,000, what is the budgeted contribution margin ratio? b If the contribution margin ratio is 30%, sales are $900,000, and fixed costs are $200,000, what is the operating income?

Cost behavior refers to the manner in which a cost changes as the related activity changes.

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

If a business had a capacity of $10,000,000 of sales, actual sales of $6,000,000, break-even sales of $4,200,000, fixed costs of $1,800,000, and variable costs of 60% of sales, what is the margin of safety expressed as a percentage of sales?

Which of the following conditions would cause the break-even point to decrease?

If the property tax rates are increased, this change in fixed costs will result in a decrease in the break-even point.

Match the following terms with their definitions. -The excess of sales revenues over variable costs

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

The relevant range is useful for analyzing cost behavior for management decision-making purposes.

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

As production increases, the fixed cost 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

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

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

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

The manufacturing cost of Calico Industries for three months of the year are provided below: Using the high-low method, the variable cost per unit and the total fixed costs are

Given the following information: Variable cost per unit = $5.00 July fixed cost per unit = $7.00 Units sold and produced in July = 28,000 What is total estimated cost for August if 30,000 units are projected to be produced and sold?

Managerial Accounting Concepts and Principles

Job Order Costing

Process Cost Systems

Variable Costing for Management Analysis

Budgeting

Performance Evaluation Using Variances From Standard Costs

Performance Evaluation for Decentralized Operations

Differential Analysis, Product Pricing, and Activity-Based Costing

Capital Investment Analysis

Cost Allocation and Activity-Based Costing

Lean Principles, Lean Accounting, and Activity Analysis

Statement of Cash Flows

Financial Statement Analysis

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

Cost behavior refers to the manner in which

a If Swannanoa Company's budgeted sales are $1,000,000, fixed costs are $350,000, and variable costs are $600,000, what is the budgeted contribution margin ratio? b If the contribution margin ratio is 30%, sales are $900,000, and fixed costs are $200,000, what is the operating income?

Cost behavior refers to the manner in which a cost changes as the related activity changes.

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

If a business had a capacity of $10,000,000 of sales, actual sales of $6,000,000, break-even sales of $4,200,000, fixed costs of $1,800,000, and variable costs of 60% of sales, what is the margin of safety expressed as a percentage of sales?

Which of the following conditions would cause the break-even point to decrease?

If the property tax rates are increased, this change in fixed costs will result in a decrease in the break-even point.

Match the following terms with their definitions. -The excess of sales revenues over variable costs

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

The relevant range is useful for analyzing cost behavior for management decision-making purposes.

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

As production increases, the fixed cost 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

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

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

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

The manufacturing cost of Calico Industries for three months of the year are provided below: Using the high-low method, the variable cost per unit and the total fixed costs are

Given the following information: Variable cost per unit = $5.00 July fixed cost per unit = $7.00 Units sold and produced in July = 28,000 What is total estimated cost for August if 30,000 units are projected to be produced and sold?

Managerial Accounting Concepts and Principles

Job Order Costing

Process Cost Systems

Variable Costing for Management Analysis

Budgeting

Performance Evaluation Using Variances From Standard Costs

Performance Evaluation for Decentralized Operations

Differential Analysis, Product Pricing, and Activity-Based Costing

Capital Investment Analysis

Cost Allocation and Activity-Based Costing

Lean Principles, Lean Accounting, and Activity Analysis

Statement of Cash Flows

Financial Statement Analysis

Filters