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Exam 19: Cost-Volume-Profit Analysis

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Question 1

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If direct materials cost per unit increases,the break-even point will increase.

A) True
B) False

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Question 2

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The range of activity over which changes in cost are of interest to management is called the relevant range.

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B) False

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Question 3

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

Global Publishers has collected the following data for recent months: Month Issues published Total cost March 20,500 $20,960 April 21,800 22,464 May 17,750 18,495 June 21,200 21,395 ​ Required: (a)Using the high-low method,find variable cost per unit,total fixed costs,and the total cost equation. (b)What is the estimated cost for a month in which 19,000 issues are published?

The relative distribution of sales among the various products sold by a business is the

The point where the profit line intersects the horizontal axis on the profit-volume chart represents

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

What was Carter Co.'s variable cost of E?

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

The Tom Company reports the following data: Determine Tom Company's operating leverage.

Explain how variable costing net income will be different than absorption costing net income under the following situations: ​ (1)A company had no beginning or ending inventory.During the year,it produced and sold 10,000 units. ​ (2)A company had no beginning inventory.During the year,it produced 10,000 units and sold 8,000 units. ​ (3)A company had 2,000 units in beginning inventory.During the year,it produced 10,000 units and sold 12,000 units.

Which of the following activity bases would be the most appropriate for gasoline costs of a delivery service?

Which of the following describes the behavior of the fixed cost per unit?

If direct materials cost per unit increases,the break-even point will decrease.

Which of the following activity bases would be the most appropriate for food costs of a hospital?

If fixed costs are $850,000 and variable costs are 60% of sales,what is the break-even point (dollars) ?

Trail Bikes,Inc.sells three Deluxe bikes for every seven Standard bikes.The Deluxe bike sells for $1,800 and has variable costs of $1,200.The Standard bike sells for $600 and has variable costs of $200. Required (a)If Trail Bikes has fixed costs that total $1,702,000,how many bikes must be sold in order for the company to break even? (b)How many of these bikes will be Deluxe bikes and how many will be the Standard bikes?

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

Given the following: ​ Variable cost as a percentage of sales = 60% Unit variable cost = $30 Fixed costs = $200,000 ​ What is the break-even point in units?

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