Question 1

Assuming that fixed costs remain unchanged,the _____________________ can be used to find the profit impact of a change in sales revenue.

Accepted Answer

contributi

Question 2

Figure 4-2. Pauley Company provides home health care.Pauley charges $35/hour for professional care.Variable costs are $21/hour and fixed costs are $78,000.Next year,Pauley expects to charge out 12,000 hours of home health care.
Refer to Figure 4-2.What is the break-even point in hours? (round to the nearest whole hour)

Accepted Answer

A) 2,229 
B) 1,393 
C) 3,714 
D) 5,571 
E) 12,000 
A) 2,229 
B) 1,393 
C) 3,714 
D) 5,571 
E) 12,000

Question 3

Information for Crisby Company is as follows:
   Required:

Accepted Answer

The answer of Information for Crisby Company is as follows:
...

Question 4

The "what-if" process of altering certain key variables to assess the effect on the original outcome is also called a __________________.

Accepted Answer

sensitivit

Question 5

Which of the following is not an assumption used to prepare a cost-volume-profit graph?

Accepted Answer

A) linear costs within the relevant range 
B) units produced equals units sold 
C) constant sales mix 
D) constant cost fluctuation 
E) all of these are assumptions used in preparing cost-volume-profit graphs 
A) linear costs within the relevant range 
B) units produced equals units sold 
C) constant sales mix 
D) constant cost fluctuation 
E) all of these are assumptions used in preparing cost-volume-profit graphs

Question 6

The margin of safety measures the units sold or the revenue earned above the break-even volume.

Accepted Answer

A) True 
 B)False

Question 7

Which is the equation for operating income?

Accepted Answer

A) (Price ´ Units sold)- (Unit variable cost ´ Units sold)- Fixed cost 
B) (Price ´ Units sold)+ (Unit variable cost ´ Units sold)+ Fixed cost 
C) (Price + Units sold)- (Unit variable cost + Units sold)- Fixed cost 
D) (Price - Units sold)+ (Unit variable cost - Units sold)+ Fixed cost 
E) (Price ´ Units sold)+ (Unit variable cost ´ Units sold)- Fixed cost 
A) (Price ´ Units sold)- (Unit variable cost ´ Units sold)- Fixed cost 
B) (Price ´ Units sold)+ (Unit variable cost ´ Units sold)+ Fixed cost 
C) (Price + Units sold)- (Unit variable cost + Units sold)- Fixed cost 
D) (Price - Units sold)+ (Unit variable cost - Units sold)+ Fixed cost 
E) (Price ´ Units sold)+ (Unit variable cost ´ Units sold)- Fixed cost

Question 8

If fixed costs increase,the break-even point in units will

Accepted Answer

A) increase. 
B) decrease. 
C) remain the same. 
D) remain the same; however,contribution per unit will decrease. 
A) increase. 
B) decrease. 
C) remain the same. 
D) remain the same; however,contribution per unit will decrease.

Question 9

The profit-volume graph

Accepted Answer

A) is difficult to interpret. 
B) fails to reveal how costs change as sales volume changes. 
C) can be only plotted if the break-even point is known. 
D) can be only plotted if fixed costs are known. 
E) shows the relationship between operating income and variable costs. 
A) is difficult to interpret. 
B) fails to reveal how costs change as sales volume changes. 
C) can be only plotted if the break-even point is known. 
D) can be only plotted if fixed costs are known. 
E) shows the relationship between operating income and variable costs.

Question 10

Figure 4-4. Yerke Company makes jungle gyms and tree houses for children.For jungle gyms,the price is $120 and variable expenses are $90 per unit.For tree houses,the price is $200 and variable expenses are $100.Total fixed expenses are $253,750.Last year,Yerke sold 12,000 gyms and 4,000 tree houses.
Refer to Figure 4-4.Now suppose that Yerke expects tree house demand to increase from 4,000 to 8,000 units.What is the number of jungle gyms sold at break-even?

Accepted Answer

A) 1,750 
B) 668 
C) 2,625 
D) 1,002 
E) 875 
A) 1,750 
B) 668 
C) 2,625 
D) 1,002 
E) 875

Question 11

If the break-even volume for a company is 600 units and the company is currently selling 1,000 units than the 400 units would represent the company's ____________________.

Accepted Answer

The answer of If the break-even volume for a company...

Question 12

Figure 4-8. A company provided the following data:
  Refer to Figure 4-8.What is the break-even point in sales dollars?

Accepted Answer

A) $498,000 
B) $400,000 
C) $171,429 
D) $112,500 
E) $150,000 
A) $498,000 
B) $400,000 
C) $171,429 
D) $112,500 
E) $150,000

Question 13

A ________________________ visually portrays the relationship between profits and units sold.

Accepted Answer

The answer of A ________________________ visually portrays the relationship between...

Question 14

How can a multi-product firm determine its break-even point?

Accepted Answer

The firm can determine its break-even po

Question 15

The ______________________ is the proportion of each sales dollar that must be used to cover variable costs.

Accepted Answer

The answer of The ______________________ is the proportion of each...

Question 16

Figure 4-3. Paney Company makes calendars.Information on cost per unit is as follows:
  Fixed marketing expense totaled $13,000 and fixed administrative expense totaled $35,000.The price per calendar is $10.
Refer to Figure 4-3.What is the variable cost per unit?

Accepted Answer

A) $5.00 
B) $4.00 
C) $3.70 
D) $1.30 
E) $4.60 
A) $5.00 
B) $4.00 
C) $3.70 
D) $1.30 
E) $4.60

Question 17

The Young Manufacturing Company produces the following three products:
   Fixed costs are $76,000 per year.
50 percent of all sales in units are hammers,30 percent are screwdrivers,and 20 percent are saws.
Required: Calculate the following values:

Accepted Answer

The answer of The Young Manufacturing Company produces the following...

Question 18

The margin of safety in dollars is

Accepted Answer

A) expected sales minus expected profit. 
B) expected sales minus sales at break-even. 
C) costs at break-even minus expected profit. 
D) expected costs minus costs at break-even. 
E) expected profit minus actual profit. 
A) expected sales minus expected profit. 
B) expected sales minus sales at break-even. 
C) costs at break-even minus expected profit. 
D) expected costs minus costs at break-even. 
E) expected profit minus actual profit.

Question 19

Figure 4-7. A company provided the following data:
  Refer to Figure 4-7.What is the break-even point in units?

Accepted Answer

A) 20,000 
B) 10,000 
C) 6,667 
D) 13,333 
E) 12,000 
A) 20,000 
B) 10,000 
C) 6,667 
D) 13,333 
E) 12,000

Question 20

Which of the following equations is true?

Accepted Answer

A) Contribution margin = Sales revenue ´ Variable cost ratio 
B) Contribution margin ratio = Contribution margin/Variable costs 
C) Contribution margin = Fixed costs 
D) Contribution margin ratio = 1 - Variable cost ratio 
A) Contribution margin = Sales revenue ´ Variable cost ratio 
B) Contribution margin ratio = Contribution margin/Variable costs 
C) Contribution margin = Fixed costs 
D) Contribution margin ratio = 1 - Variable cost ratio

Assuming that fixed costs remain unchanged,the _____________________ can be used to find the profit impact of a change in sales revenue.

Information for Crisby Company is as follows: Required:

The "what-if" process of altering certain key variables to assess the effect on the original outcome is also called a __________________.

Which of the following is not an assumption used to prepare a cost-volume-profit graph?

The margin of safety measures the units sold or the revenue earned above the break-even volume.

Which is the equation for operating income?

If fixed costs increase,the break-even point in units will

The profit-volume graph

If the break-even volume for a company is 600 units and the company is currently selling 1,000 units than the 400 units would represent the company's ____________________.

Figure 4-8. A company provided the following data: Refer to Figure 4-8.What is the break-even point in sales dollars?

A ________________________ visually portrays the relationship between profits and units sold.

How can a multi-product firm determine its break-even point?

The ______________________ is the proportion of each sales dollar that must be used to cover variable costs.

Figure 4-3. Paney Company makes calendars.Information on cost per unit is as follows: Fixed marketing expense totaled $13,000 and fixed administrative expense totaled $35,000.The price per calendar is $10. Refer to Figure 4-3.What is the variable cost per unit?

The Young Manufacturing Company produces the following three products: Fixed costs are $76,000 per year. 50 percent of all sales in units are hammers,30 percent are screwdrivers,and 20 percent are saws. Required: Calculate the following values:

The margin of safety in dollars is

Figure 4-7. A company provided the following data: Refer to Figure 4-7.What is the break-even point in units?

Which of the following equations is true?

Introduction to Managerial Accounting

Basic Managerial Accounting Concepts

Cost Behavior

Job-Order Costing

Process Costing

Activity-Based Costing and Management

Absorption and Variable Costing,and Inventory Management

Profit Planning

Standard Costing: a Managerial Control Tool

Flexible Budgets and Overhead Analysis

Performance Evaluation and Decentralization

Short-Run Decision Making: Relevant Costing

Capital Investment Decisions

Statement of Cash Flows

Financial Statement Analysis

Filters

Exam 4: Cost-Volume-Profit Analysis: a Managerial Planning Tool

Assuming that fixed costs remain unchanged,the _____________________ can be used to find the profit impact of a change in sales revenue.

Information for Crisby Company is as follows: Required:

The "what-if" process of altering certain key variables to assess the effect on the original outcome is also called a __________________.

Which of the following is not an assumption used to prepare a cost-volume-profit graph?

The margin of safety measures the units sold or the revenue earned above the break-even volume.

Which is the equation for operating income?

If fixed costs increase,the break-even point in units will

The profit-volume graph

If the break-even volume for a company is 600 units and the company is currently selling 1,000 units than the 400 units would represent the company's ____________________.

Figure 4-8. A company provided the following data: Refer to Figure 4-8.What is the break-even point in sales dollars?

A ________________________ visually portrays the relationship between profits and units sold.

How can a multi-product firm determine its break-even point?

The ______________________ is the proportion of each sales dollar that must be used to cover variable costs.

Figure 4-3. Paney Company makes calendars.Information on cost per unit is as follows: Fixed marketing expense totaled $13,000 and fixed administrative expense totaled $35,000.The price per calendar is $10. Refer to Figure 4-3.What is the variable cost per unit?

The Young Manufacturing Company produces the following three products: Fixed costs are $76,000 per year. 50 percent of all sales in units are hammers,30 percent are screwdrivers,and 20 percent are saws. Required: Calculate the following values:

The margin of safety in dollars is

Figure 4-7. A company provided the following data: Refer to Figure 4-7.What is the break-even point in units?

Which of the following equations is true?

Introduction to Managerial Accounting

Basic Managerial Accounting Concepts

Cost Behavior

Job-Order Costing

Process Costing

Activity-Based Costing and Management

Absorption and Variable Costing,and Inventory Management

Profit Planning

Standard Costing: a Managerial Control Tool

Flexible Budgets and Overhead Analysis

Performance Evaluation and Decentralization

Short-Run Decision Making: Relevant Costing

Capital Investment Decisions

Statement of Cash Flows

Financial Statement Analysis

Filters