Question 1

The contribution margin ratio is computed as:

Accepted Answer

A)  sales divided by contribution margin 
B)  contribution margin divided by sales 
C)  contribution margin divided by cost of sales 
D)  contribution margin divided by variable cost of sales 
A)  sales divided by contribution margin 
B)  contribution margin divided by sales 
C)  contribution margin divided by cost of sales 
D)  contribution margin divided by variable cost of sales

Question 2

Sales mix is generally defined as the relative distribution of sales among the various products sold.

Accepted Answer

A) True 
 B)False

Question 3

A business operated at 100% of capacity during its first month and incurred the following costs: ​
  If 1,500 units remain unsold at the end of the month,what is the amount of inventory that would be reported on the variable costing balance sheet?

Accepted Answer

A)  $62,500 
B)  $73,500 
C)  $60,000 
D)  $52,500 
A)  $62,500 
B)  $73,500 
C)  $60,000 
D)  $52,500

Question 4

For a supervisor of a manufacturing department,which of the following costs is controllable?

Accepted Answer

A)  direct materials 
B)  insurance on factory building 
C)  depreciation of factory building 
D)  sales salaries 
A)  direct materials 
B)  insurance on factory building 
C)  depreciation of factory building 
D)  sales salaries

Question 5

Tony's Company has the following information for March:
​
   Determine the March (a)manufacturing margin,(b)contribution margin,and (c)income from operations for Tony's Company.

Accepted Answer

The answer of Tony's Company has the following information for...

Question 6

Under variable costing,which of the following costs would not be included in finished goods inventory?

Accepted Answer

A)  direct labor cost 
B)  direct materials cost 
C)  variable factory overhead cost 
D)  fixed factory overhead cost 
A)  direct labor cost 
B)  direct materials cost 
C)  variable factory overhead cost 
D)  fixed factory overhead cost

Question 7

In contribution margin analysis,the increase or decrease in unit sales price or unit cost on the number of units sold is referred to as the:

Accepted Answer

A)  sales factor 
B)  cost of goods sold factor 
C)  quantity factor 
D)  unit price or unit cost factor 
A)  sales factor 
B)  cost of goods sold factor 
C)  quantity factor 
D)  unit price or unit cost factor

Question 8

The Excelsior Company has three salespersons.Average sales price per unit sold,average variable manufacturing costs per unit,and number of units sold for each salesperson are shown below.
Commissions are earned according to the following schedule:
​
   ​
   Prepare a contribution by salesperson report.

Accepted Answer

The answer of The Excelsior Company has three salespersons.Average sales...

Question 9

Which of the following is(are)reason(s)for easy identification and control of variable manufacturing costs under the variable costing method?

Accepted Answer

A)  variable and fixed costs are reported separately. 
B)  variable costs can be controlled by the operating management. 
C)  fixed costs,such as property insurance,are normally the responsibility of higher management not the operating management. 
D)  All of the above are true. 
A)  variable and fixed costs are reported separately. 
B)  variable costs can be controlled by the operating management. 
C)  fixed costs,such as property insurance,are normally the responsibility of higher management not the operating management. 
D)  All of the above are true.

Question 10

In contribution margin analysis,the quantity factor is computed as:

Accepted Answer

A)  the increase or decrease in the number of units sold multiplied by the planned unit sales price or unit cost 
B)  the increase or decrease in unit sales price or unit cost multiplied by the planned number of units to be sold 
C)  the increase or decrease in the number of units sold multiplied by the actual unit sales price or unit cost 
D)  the increase or decrease in the unit sales price or unit cost multiplied by the actual number of units sold 
A)  the increase or decrease in the number of units sold multiplied by the planned unit sales price or unit cost 
B)  the increase or decrease in unit sales price or unit cost multiplied by the planned number of units to be sold 
C)  the increase or decrease in the number of units sold multiplied by the actual unit sales price or unit cost 
D)  the increase or decrease in the unit sales price or unit cost multiplied by the actual number of units sold

Question 11

Under absorption costing,increases or decreases in income from operations due to changes in inventory levels could be misinterpreted to be the result of operating efficiencies or inefficiencies.

Accepted Answer

A) True 
 B)False

Question 12

If the ability to sell and the amount of production facilities devoted to each of two products is equal,it is profitable to increase the sales of that product with the highest contribution margin.

Accepted Answer

A) True 
 B)False

Question 13

In contribution margin analysis,the effect of a difference in the number of units sold,assuming no change in unit sales price or cost,is termed the unit price or unit cost factor.

Accepted Answer

A) True 
 B)False

Question 14

The actual price for a product was $50 per unit,while the planned price was $44 per unit.The volume increased by 4,000 to 60,000 total units.Determine (a)the quantity factor and (b)the price factor for sales.

Accepted Answer

The answer of The actual price for a product was...

Question 15

The relative distribution of sales among various products sold is referred to as the:

Accepted Answer

A)  by-product mix 
B)  joint product mix 
C)  profit mix 
D)  sales mix 
A)  by-product mix 
B)  joint product mix 
C)  profit mix 
D)  sales mix

Question 16

What is the amount of the income from operations that would be reported on the variable costing income statement?

Accepted Answer

A)  $18,900 
B)  $18,200 
C)  $18,000 
D)  $21,000 
A)  $18,900 
B)  $18,200 
C)  $18,000 
D)  $21,000

Question 17

At XLT Inc,variable costs are $80 per unit,and fixed costs are $40,000.Sales are estimated to be 4,000 units.(a)How much would absorption costing income from operations differ between a plan to produce 8,000 units and a plan to produce 10,000 units? (b)How much would variable costing income from operations differ between the two production plans?

Accepted Answer

The answer of At XLT Inc,variable costs are $80 per...

Question 18

On the variable costing income statement,variable selling and administrative expenses are deducted from manufacturing margin to yield contribution margin.

Accepted Answer

A) True 
 B)False

Question 19

In a service firm,it may be necessary to have several activity bases to properly match the change in costs with the changes in various activities.

Accepted Answer

A) True 
 B)False

Question 20

In contribution margin analysis,the effect of a difference in unit sales price or unit cost on the number of units sold is termed the quantity factor.

Accepted Answer

A) True 
 B)False

Exam 20: Variable Costing for Management Analysis

The contribution margin ratio is computed as:

Sales mix is generally defined as the relative distribution of sales among the various products sold.

A business operated at 100% of capacity during its first month and incurred the following costs: ​ If 1,500 units remain unsold at the end of the month,what is the amount of inventory that would be reported on the variable costing balance sheet?

For a supervisor of a manufacturing department,which of the following costs is controllable?

Tony's Company has the following information for March: ​ Determine the March (a)manufacturing margin,(b)contribution margin,and (c)income from operations for Tony's Company.

Under variable costing,which of the following costs would not be included in finished goods inventory?

In contribution margin analysis,the increase or decrease in unit sales price or unit cost on the number of units sold is referred to as the:

Which of the following is(are)reason(s)for easy identification and control of variable manufacturing costs under the variable costing method?

In contribution margin analysis,the quantity factor is computed as:

Under absorption costing,increases or decreases in income from operations due to changes in inventory levels could be misinterpreted to be the result of operating efficiencies or inefficiencies.

If the ability to sell and the amount of production facilities devoted to each of two products is equal,it is profitable to increase the sales of that product with the highest contribution margin.

In contribution margin analysis,the effect of a difference in the number of units sold,assuming no change in unit sales price or cost,is termed the unit price or unit cost factor.

The actual price for a product was $50 per unit,while the planned price was $44 per unit.The volume increased by 4,000 to 60,000 total units.Determine (a)the quantity factor and (b)the price factor for sales.

The relative distribution of sales among various products sold is referred to as the:

What is the amount of the income from operations that would be reported on the variable costing income statement?

On the variable costing income statement,variable selling and administrative expenses are deducted from manufacturing margin to yield contribution margin.

In a service firm,it may be necessary to have several activity bases to properly match the change in costs with the changes in various activities.

In contribution margin analysis,the effect of a difference in unit sales price or unit cost on the number of units sold is termed the quantity factor.

Introduction to Accounting and Business

Analyzing Transactions

The Adjusting Process

Completing the Accounting Cycle

Accounting for Merchandising Businesses

Inventories

Internal Control and Cash

Receivables

Long-Term Assets: Fixed and Intangible

Liabilities: Current,installment Notes,and Contingencies

Liabilities: Bonds Payable

Corporations: Organization, stock Transactions, and Dividends

Statement of Cash Flows

Financial Statement Analysis

Introduction to Managerial Accounting

Job Order Costing

Process Cost Systems

Activity-Based Costing

Cost-Volume-Profit Analysis

Budgeting

Evaluating Variances From Standard Costs

Evaluating Decentralized Operations

Differential Analysis and Product Pricing

Capital Investment Analysis

Lean Manufacturing and Activity Analysis

Filters

A business operated at 100% of capacity during its first month and incurred the following costs: If 1,500 units remain unsold at the end of the month,what is the amount of inventory that would be reported on the variable costing balance sheet?

Tony's Company has the following information for March: Determine the March (a)manufacturing margin,(b)contribution margin,and (c)income from operations for Tony's Company.