Exam 19: Cost Behavior and Cost-Volume-Profit Analysis

If the unit selling price is $40, the volume of sales is $3,000,000, sales at the break-even point amount to $2,500,000, and the maximum possible sales are $3,300,000, the margin of safety is 11,500 units.

If fixed costs are $600,000 and the unit contribution margin is $40, what is the break-even point if fixed costs are increased by $90,000?

Because variable costs are assumed to change in direct proportion to changes in the activity level, the graph of the variable costs when plotted against the activity level appears as a circle.

Given the following cost data, what type of cost is shown?

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

Total variable costs change as the level of activity changes.

The dollars available from each unit of sales to cover fixed cost and profit is the unit variable cost.

Given the following cost data, what type of cost is shown?

A company with a break-even point at $900,000 in sales revenue had fixed costs of $225,000. When actual sales were $1,000,000 variable costs were $750,000. Determine (a) the margin of safety expressed in dollars, (b) the margin of safety expressed as a percentage of sales, (c) the contribution margin ratio, and (d) the operating income.

If fixed costs are $240,000, the unit selling price is $32, and the unit variable costs are $20, what are the old and new break-even sales (units) if the unit selling price increases by $4?

If variable costs per unit increased because of an increase in hourly wage rates, the break-even point would:

If the volume of sales is $6,000,000 and sales at the break-even point amount to $4,800,000, the margin of safety is 25%.

If fixed costs are $46,800, the unit selling price is $42, and the unit variable costs are $24, what is the break-even sales (unit ) if the variable costs are decreased by $2?

Safari Co. sells two products, Orks and Zins. Last year Safari sold 21,000 units of Orks and 14,000 units of Zins. Related data are: Calculate the following: a. Safari Co.'s sales mix b. Safari Co.'s weighted average unit selling price c. Safari Co's weighted average unit contribution margin d. Safari Co's break-even point assuming that last year's fixed costs were $160,000.

Carter Co. sells two products, Arks and Bins. Last year Carter sold 14,000 units of Arks and 56,000 units of Bins. Related data are: What was Carter Co.'s weighted average unit selling price?

When the fixed costs are $120,000 and the contribution margin is $30, the break-even point is

If fixed costs are $850,000 and the unit contribution margin is $50, profit is zero when 15,000 units are sold.

The Atlantic Company sells a product with a break-even point of 3,000 sales units. The variable cost is $60 per unit, and fixed costs are $270,000. Determine the (a) unit sales price, and (b) break-even points in sales units if the company desires a target profit of $36,000.

Silver River Company sells Products S and T and has made the following estimates for the coming year: Fixed costs are estimated at $202,400. Determine (a) the estimated sales in units of the overall product necessary to reach the break-even point for the coming year, (b) the estimated number of units of each product necessary to be sold to reach the break-even point for the coming year, and (c) the estimated sales in units of the overall product necessary to realize an operating income of $119,600 for the coming year.

A cost that has characteristics of both a variable cost and a fixed cost is called a: