Question 1

The unit contribution margin is the dollars available from each unit of sales to cover fixed cost and provide operating income.

Accepted Answer

A) True 
 B)False

Question 2

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

Accepted Answer

A) True 
 B)False

Question 3

A low operating leverage is normal for highly automated industries.

Accepted Answer

A) True 
 B)False

Question 4

Variable costs are costs that vary in total in direct proportion to changes in the activity level.

Accepted Answer

A) True 
 B)False

Question 5

The variable cost per unit remains constant with changes in the level of activity.

Accepted Answer

A) True 
 B)False

Question 6

A rental cost of $40,000 plus $0.50 per machine hour of use is an example of a mixed cost.

Accepted Answer

A) True 
 B)False

Question 7

For the purpose of analysis, mixed costs are generally:

Accepted Answer

A)  classified as fixed costs. 
B)  classified as variable costs. 
C)  classified as period costs. 
D)  separated into their variable and fixed cost components. 
A)  classified as fixed costs. 
B)  classified as variable costs. 
C)  classified as period costs. 
D)  separated into their variable and fixed cost components.

Question 8

Variable cost per unit remains the same regardless of activity level.

Accepted Answer

A) True 
 B)False

Question 9

DeGiaimo Co.has an operating leverage of 5.If next year's sales are expected to increase by 10%, then the company's operating income will increase by 50%.

Accepted Answer

A) True 
 B)False

The unit contribution margin is the dollars available from each unit of sales to cover fixed cost and provide operating income.

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

A low operating leverage is normal for highly automated industries.

Variable costs are costs that vary in total in direct proportion to changes in the activity level.

The variable cost per unit remains constant with changes in the level of activity.

A rental cost of $40,000 plus $0.50 per machine hour of use is an example of a mixed cost.

For the purpose of analysis, mixed costs are generally:

Variable cost per unit remains the same regardless of activity level.

DeGiaimo Co.has an operating leverage of 5.If next year's sales are expected to increase by 10%, then the company's operating income will increase by 50%.

The Role of Accounting in Business

Basic Accounting Systems: Cash Basis

Basic Accounting Systems: Accrual Basis

Accounting for Merchandising Businesses

Internal Control and Cash

Receivables and Inventories

Fixed Assets, Natural Resources, and Intangible Assets

Liabilities and Stockholders Equity

Metric Analysis of Financial Statements

Accounting for Manufacturing Operations

Differential Analysis and Product Pricing

Budgeting and Standard Costs

Performance Evaluation for Decentralized Operations

Capital Investment Analysis

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Exam 11: Cost-Volume-Profit Analysis

The unit contribution margin is the dollars available from each unit of sales to cover fixed cost and provide operating income.

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

A low operating leverage is normal for highly automated industries.

Variable costs are costs that vary in total in direct proportion to changes in the activity level.

The variable cost per unit remains constant with changes in the level of activity.

A rental cost of $40,000 plus $0.50 per machine hour of use is an example of a mixed cost.

For the purpose of analysis, mixed costs are generally:

Variable cost per unit remains the same regardless of activity level.

DeGiaimo Co.has an operating leverage of 5.If next year's sales are expected to increase by 10%, then the company's operating income will increase by 50%.

The Role of Accounting in Business

Basic Accounting Systems: Cash Basis

Basic Accounting Systems: Accrual Basis

Accounting for Merchandising Businesses

Internal Control and Cash

Receivables and Inventories

Fixed Assets, Natural Resources, and Intangible Assets

Liabilities and Stockholders Equity

Metric Analysis of Financial Statements

Accounting for Manufacturing Operations

Differential Analysis and Product Pricing

Budgeting and Standard Costs

Performance Evaluation for Decentralized Operations

Capital Investment Analysis

Filters