Question 1

Increased sales of high contribution margin items __________ the break-even point.

Accepted Answer

The answer of Increased sales of high contribution margin items...

Question 2

Assuming all other things are the same, if there was an increase in the break-even point, contribution margin per unit must have:

Accepted Answer

A)  remained the same 
B)  increased first, then decreased 
C)  decreased 
D)  increased 
A)  remained the same 
B)  increased first, then decreased 
C)  decreased 
D)  increased

Question 3

The Leonardo Company had the following functional income statement for the month of July 2014:
   There were no beginning and ending inventories.
Required:

Accepted Answer

The answer of The Leonardo Company had the following functional...

Question 4

Assuming all other things are the same, if there was a decrease in the break-even point, selling price per unit must have:

Accepted Answer

A)  decreased 
B)  increased 
C)  remained the same 
D)  increased first, then decreased 
A)  decreased 
B)  increased 
C)  remained the same 
D)  increased first, then decreased

Question 5

In a CVP graph, the intersection of the total costs line and the total sales revenue line is the break-even point in units.

Accepted Answer

A) True 
 B)False

Question 6

Nonesuch Company sells only one product at a regular price of $7.50 per unit. Variable expenses are 60 percent of sales and fixed expenses are $30,000. Management has decided to decrease the selling price to $6.00 in hopes of increasing its volume of sales. What is the contribution margin ratio when the selling price is reduced to $6 per unit?

Accepted Answer

A)  40% 
B)  25% 
C)  75% 
D)  60% 
A)  40% 
B)  25% 
C)  75% 
D)  60%

Question 7

The operating leverage shows how far the company's actual sales or units are from the break-even point.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following equations is CORRECT?

Accepted Answer

A)  Sales revenues = Variable expenses - (Fixed expenses + Operating income) 
B)  Sales revenues - Variable expenses - Fixed expenses = Operating income 
C)  Sales revenues + Variable expenses + Fixed expenses = Operating income 
D)  Sales revenues - Fixed expenses = Variable expenses - Operating income 
A)  Sales revenues = Variable expenses - (Fixed expenses + Operating income) 
B)  Sales revenues - Variable expenses - Fixed expenses = Operating income 
C)  Sales revenues + Variable expenses + Fixed expenses = Operating income 
D)  Sales revenues - Fixed expenses = Variable expenses - Operating income

Question 9

Fantasmas Incorporated had the following information:   Suppose Fantasmas could reduce setup costs by $300 per setup and could reduce the number of engineering hours needed to 1,400 hours. How many units must be sold to break even in this case?

Accepted Answer

A)  7,243 units 
B)  24,340 units 
C)  12,170 units 
D)  8,554 units 
A)  7,243 units 
B)  24,340 units 
C)  12,170 units 
D)  8,554 units

Question 10

The use of fixed costs to increase the percentage changes in profits as sales activities change is called the __________ leverage.

Accepted Answer

The answer of The use of fixed costs to increase...

Question 11

The profit-volume graph depicts the relationship among cost, volume, and profit.

Accepted Answer

A) True 
 B)False

Question 12

On a profit-volume graph, the __________ line intersects the horizontal axis at the break-even point.

Accepted Answer

The answer of On a profit-volume graph, the __________ line...

Question 13

In a cost-volume-profit graph, the slope of the total cost line represents

Accepted Answer

A)  the selling price per unit. 
B)  the contribution margin per unit. 
C)  the variable cost per unit. 
D)  total contribution margin. 
A)  the selling price per unit. 
B)  the contribution margin per unit. 
C)  the variable cost per unit. 
D)  total contribution margin.

Question 14

The Mildmanner Corporation has the following data for 2014:   The margin of safety expressed in sales revenue will be

Accepted Answer

A)  $75,000. 
B)  $37,500. 
C)  $45,000. 
D)  $112,500 
A)  $75,000. 
B)  $37,500. 
C)  $45,000. 
D)  $112,500

Question 15

Under ABC, cost drivers are separated into unit-based and non-unit-based drivers.

Accepted Answer

A) True 
 B)False

Question 16

Multiple-product break-even analysis requires a constant sales mix, which is difficult to predict with certainty.

Accepted Answer

A) True 
 B)False

Question 17

Hologram Printing Company projected the following information for next year:   What is the break-even point in dollars?

Accepted Answer

A)  $200,000 
B)  $120,000 
C)  $300,000 
D)  $500,000 
A)  $200,000 
B)  $120,000 
C)  $300,000 
D)  $500,000

Question 18

Sensitivity analysis is a what-if technique that examines the impact of changes in assumptions.

Accepted Answer

A) True 
 B)False

Question 19

The DesMaris Company had the following income statement for the month of November 2014:   What is the sales volume required to earn an operating profit of $9,000?

Accepted Answer

A)  3,300 units 
B)  10,000 units 
C)  4,300 units 
D)  7,300 units 
A)  3,300 units 
B)  10,000 units 
C)  4,300 units 
D)  7,300 units

Question 20

The DesMaris Company had the following income statement for the month of November 2014:   DesMaris Company's break-even sales volume is

Accepted Answer

A)  7,000 units. 
B)  20,000 units. 
C)  11,211 units. 
D)  10,000 units. 
A)  7,000 units. 
B)  20,000 units. 
C)  11,211 units. 
D)  10,000 units.

Increased sales of high contribution margin items __________ the break-even point.

Assuming all other things are the same, if there was an increase in the break-even point, contribution margin per unit must have:

The Leonardo Company had the following functional income statement for the month of July 2014: There were no beginning and ending inventories. Required:

Assuming all other things are the same, if there was a decrease in the break-even point, selling price per unit must have:

In a CVP graph, the intersection of the total costs line and the total sales revenue line is the break-even point in units.

The operating leverage shows how far the company's actual sales or units are from the break-even point.

Which of the following equations is CORRECT?

Fantasmas Incorporated had the following information: Suppose Fantasmas could reduce setup costs by $300 per setup and could reduce the number of engineering hours needed to 1,400 hours. How many units must be sold to break even in this case?

The use of fixed costs to increase the percentage changes in profits as sales activities change is called the __________ leverage.

The profit-volume graph depicts the relationship among cost, volume, and profit.

On a profit-volume graph, the __________ line intersects the horizontal axis at the break-even point.

In a cost-volume-profit graph, the slope of the total cost line represents

The Mildmanner Corporation has the following data for 2014: The margin of safety expressed in sales revenue will be

Under ABC, cost drivers are separated into unit-based and non-unit-based drivers.

Multiple-product break-even analysis requires a constant sales mix, which is difficult to predict with certainty.

Hologram Printing Company projected the following information for next year: What is the break-even point in dollars?

Sensitivity analysis is a what-if technique that examines the impact of changes in assumptions.

The DesMaris Company had the following income statement for the month of November 2014: What is the sales volume required to earn an operating profit of $9,000?

The DesMaris Company had the following income statement for the month of November 2014: DesMaris Company's break-even sales volume is

Introduction to Cost Management

Basic Cost Management Concepts

Cost Behavior

Activity-Based Costing

Product and Service Costing: Job-Order System

Process Costing

Allocating Costs of Support Departments and Joint Products

Budgeting for Planning and Control Key

Standard Costing: a Functional-Based Control Approach

Decentralization: Responsibility Accounting, Performance Evaluation, and Transfer Pricing

Strategic Cost Management

Activity-Based Management

The Balanced Scorecard: Strategic-Based Control

Quality and Environmental Cost Management

Lean Accounting and Productivity Measurement

Activity Resource Usage Model and Tactical Decision Making

Pricing and Profitability Analysis

Capital Investment

Inventory Management: Economic Order Quantity, Jit, and the Theory of Constraints

Filters

Exam 16: Cost-Volume-Profit Analysis

Increased sales of high contribution margin items __________ the break-even point.

Assuming all other things are the same, if there was an increase in the break-even point, contribution margin per unit must have:

The Leonardo Company had the following functional income statement for the month of July 2014: There were no beginning and ending inventories. Required:

Assuming all other things are the same, if there was a decrease in the break-even point, selling price per unit must have:

In a CVP graph, the intersection of the total costs line and the total sales revenue line is the break-even point in units.

The operating leverage shows how far the company's actual sales or units are from the break-even point.

Which of the following equations is CORRECT?

Fantasmas Incorporated had the following information: Suppose Fantasmas could reduce setup costs by $300 per setup and could reduce the number of engineering hours needed to 1,400 hours. How many units must be sold to break even in this case?

The use of fixed costs to increase the percentage changes in profits as sales activities change is called the __________ leverage.

The profit-volume graph depicts the relationship among cost, volume, and profit.

On a profit-volume graph, the __________ line intersects the horizontal axis at the break-even point.

In a cost-volume-profit graph, the slope of the total cost line represents

The Mildmanner Corporation has the following data for 2014: The margin of safety expressed in sales revenue will be

Under ABC, cost drivers are separated into unit-based and non-unit-based drivers.

Multiple-product break-even analysis requires a constant sales mix, which is difficult to predict with certainty.

Hologram Printing Company projected the following information for next year: What is the break-even point in dollars?

Sensitivity analysis is a what-if technique that examines the impact of changes in assumptions.

The DesMaris Company had the following income statement for the month of November 2014: What is the sales volume required to earn an operating profit of $9,000?

The DesMaris Company had the following income statement for the month of November 2014: DesMaris Company's break-even sales volume is

Introduction to Cost Management

Basic Cost Management Concepts

Cost Behavior

Activity-Based Costing

Product and Service Costing: Job-Order System

Process Costing

Allocating Costs of Support Departments and Joint Products

Budgeting for Planning and Control Key

Standard Costing: a Functional-Based Control Approach

Decentralization: Responsibility Accounting, Performance Evaluation, and Transfer Pricing

Strategic Cost Management

Activity-Based Management

The Balanced Scorecard: Strategic-Based Control

Quality and Environmental Cost Management

Lean Accounting and Productivity Measurement

Activity Resource Usage Model and Tactical Decision Making

Pricing and Profitability Analysis

Capital Investment

Inventory Management: Economic Order Quantity, Jit, and the Theory of Constraints

Filters