Question 1

The income statement for Thomas Manufacturing Company for 2006 is as follows:   What is the contribution margin per unit?

Accepted Answer

A)  $7.20 
B)  $1.20 
C)  $4.80 
D)  $120,000 
A)  $7.20 
B)  $1.20 
C)  $4.80 
D)  $120,000

Question 2

Which of the following is a TRUE statement about sales mix?

Accepted Answer

A)  Profits may decline with an increase in total dollars of sales if the sales mix shifts to sell more of the high contribution margin product. 
B)  Profits may decline with an increase in total dollars of sales if the sales mix shifts to sell more of the lower contribution margin product. 
C)  Profits will remain constant with an increase in total dollars of sales if the total sales in units remains constant. 
D)  Profits will remain constant with a decrease in total dollars of sales if the sales mix also remains constant. 
A)  Profits may decline with an increase in total dollars of sales if the sales mix shifts to sell more of the high contribution margin product. 
B)  Profits may decline with an increase in total dollars of sales if the sales mix shifts to sell more of the lower contribution margin product. 
C)  Profits will remain constant with an increase in total dollars of sales if the total sales in units remains constant. 
D)  Profits will remain constant with a decrease in total dollars of sales if the sales mix also remains constant.

Question 3

In a profit-volume graph, the slope of the profit 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 4

Figure 16 - 1 The Kringel Company provides the following information:
  
-Refer to Figure 16-1.What is the break-even point in units for Kringel?

Accepted Answer

A)  33,334 units 
B)  100,000 units 
C)  40,000 units 
D)  200,000 units 
A)  33,334 units 
B)  100,000 units 
C)  40,000 units 
D)  200,000 units

Question 5

The Smith Corporation has the following data for 2011:  
- The margin of safety in units will be (round to the nearest whole unit)

Accepted Answer

A)  4,000. 
B)  667. 
C)  2,500. 
D)  7,500. 
A)  4,000. 
B)  667. 
C)  2,500. 
D)  7,500.

Question 6

At a monthly volume of $25,000, a company incurs variable cost of $19,000 and fixed costs of $6,000.
Required:
Determine each of the following values:

Accepted Answer

The answer of At a monthly volume of $25,000, a...

Question 7

Lewis Production Company had the following projected information for 2011:   What level of sales dollars is needed to obtain a target before-tax profit of $75,000?

Accepted Answer

A)  $375,000 
B)  $625,000 
C)  $750,000 
D)  $937,500 
A)  $375,000 
B)  $625,000 
C)  $750,000 
D)  $937,500

Question 8

Xi Company is the exclusive Iowa distributor of lawn mowers for a small manufacturing company.It sells only one model at $600 per unit and for which Xi pays $250.Xi's other variable costs amount to $50 per unit.Fixed costs are $2,000.In October, Xi sold 15 lawn mowers and it sold 20 in November.
Required:
Calculate the following values:

Accepted Answer

The answer of Xi Company is the exclusive Iowa distributor...

Question 9

The Smith Corporation has the following data for 2011:   
-The margin of safety expressed in sales revenue will be

Accepted Answer

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

Question 10

Which of the following assumptions does NOT pertain to cost-profit-volume analysis?

Accepted Answer

A)  Sales price per unit remains constant. 
B)  The sales mix is constant. 
C)  Inventories in a manufacturing entity may go up or down. 
D)  Fixed expenses are constant at all volumes of activities within the relevant range. 
A)  Sales price per unit remains constant. 
B)  The sales mix is constant. 
C)  Inventories in a manufacturing entity may go up or down. 
D)  Fixed expenses are constant at all volumes of activities within the relevant range.

Question 11

Which of the following assumptions is NOT necessary for cost-volume-profit analysis?

Accepted Answer

A)  total variable costs are linear 
B)  total revenues increase when total costs increase 
C)  inventories are constant 
D)  the product sales mix is constant 
A)  total variable costs are linear 
B)  total revenues increase when total costs increase 
C)  inventories are constant 
D)  the product sales mix is constant

Question 12

The income statement for Thomas Manufacturing Company for 2011 is as follows:  
- If sales increase by $60,000, what will happen to profit?

Accepted Answer

A)  increase by $60,000 
B)  increase by $24,000 
C)  increase by $6,000 
D)  increase by $36,000 
A)  increase by $60,000 
B)  increase by $24,000 
C)  increase by $6,000 
D)  increase by $36,000

Question 13

Barco, Inc.decided to institute an advertising campaign that would cost $75,000.Variable costs will remain at $15 per unit.Barco is currently selling 100,000 units of its product at $25 per unit.The marketing department is estimating that there will be a 10 percent increase in sales volume.With all else remaining the same, what will be the result of this decision?

Accepted Answer

A)  An increase in operating income of $25,000 
B)  A decrease in operating income of $75,000 
C)  An increase in sales of $25,000 
D)  none of the above 
A)  An increase in operating income of $25,000 
B)  A decrease in operating income of $75,000 
C)  An increase in sales of $25,000 
D)  none of the above

Question 14

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

Accepted Answer

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

Question 15

Which of the following statements is TRUE?

Accepted Answer

A)  The slope of the total cost line is dependent on the variable cost per unit. 
B)  The total cost line normally begins at zero. 
C)  The total revenue line typically begins above zero. 
D)  The slope of the total revenue line is the contribution margin per unit. 
A)  The slope of the total cost line is dependent on the variable cost per unit. 
B)  The total cost line normally begins at zero. 
C)  The total revenue line typically begins above zero. 
D)  The slope of the total revenue line is the contribution margin per unit.

Question 16

Lewis Production Company had the following projected information for 2011:   What is the contribution margin ratio?

Accepted Answer

A)  0.400 
B)  1.667 
C)  2.500 
D)  0.600 
A)  0.400 
B)  1.667 
C)  2.500 
D)  0.600

Question 17

Zachary Plumbing Company has the following information for 2011:
   Required:
Prepare a profit-volume graph identifying the following items:

Accepted Answer

@#IMG-DLM&_TB2043_00 *The brea

Question 18

In the Cost-Volume-Profit analysis, what are two ways management can deal with risk and uncertainty?

Accepted Answer

Two concepts that are considered measure

Question 19

Information about the Harmon Company's two products includes:   What is the total monthly sales volume in units required to break even when the sales mix in units is 70 percent Product X and 30 percent Product Y?

Accepted Answer

A)  8,333 units 
B)  50,000 units 
C)  16,667 units 
D)  56,667 units 
A)  8,333 units 
B)  50,000 units 
C)  16,667 units 
D)  56,667 units

Question 20

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.

The income statement for Thomas Manufacturing Company for 2006 is as follows: What is the contribution margin per unit?

Which of the following is a TRUE statement about sales mix?

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

Figure 16 - 1 The Kringel Company provides the following information: -Refer to Figure 16-1.What is the break-even point in units for Kringel?

The Smith Corporation has the following data for 2011: - The margin of safety in units will be (round to the nearest whole unit)

At a monthly volume of $25,000, a company incurs variable cost of $19,000 and fixed costs of $6,000. Required: Determine each of the following values:

Lewis Production Company had the following projected information for 2011: What level of sales dollars is needed to obtain a target before-tax profit of $75,000?

The Smith Corporation has the following data for 2011: -The margin of safety expressed in sales revenue will be

Which of the following assumptions does NOT pertain to cost-profit-volume analysis?

Which of the following assumptions is NOT necessary for cost-volume-profit analysis?

The income statement for Thomas Manufacturing Company for 2011 is as follows: - If sales increase by $60,000, what will happen to profit?

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

Which of the following statements is TRUE?

Lewis Production Company had the following projected information for 2011: What is the contribution margin ratio?

Zachary Plumbing Company has the following information for 2011: Required: Prepare a profit-volume graph identifying the following items:

In the Cost-Volume-Profit analysis, what are two ways management can deal with risk and uncertainty?

Information about the Harmon Company's two products includes: What is the total monthly sales volume in units required to break even when the sales mix in units is 70 percent Product X and 30 percent Product Y?

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

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

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

The income statement for Thomas Manufacturing Company for 2006 is as follows: What is the contribution margin per unit?

Which of the following is a TRUE statement about sales mix?

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

Figure 16 - 1 The Kringel Company provides the following information: -Refer to Figure 16-1.What is the break-even point in units for Kringel?

The Smith Corporation has the following data for 2011: - The margin of safety in units will be (round to the nearest whole unit)

At a monthly volume of $25,000, a company incurs variable cost of $19,000 and fixed costs of $6,000. Required: Determine each of the following values:

Lewis Production Company had the following projected information for 2011: What level of sales dollars is needed to obtain a target before-tax profit of $75,000?

The Smith Corporation has the following data for 2011: -The margin of safety expressed in sales revenue will be

Which of the following assumptions does NOT pertain to cost-profit-volume analysis?

Which of the following assumptions is NOT necessary for cost-volume-profit analysis?

The income statement for Thomas Manufacturing Company for 2011 is as follows: - If sales increase by $60,000, what will happen to profit?

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

Which of the following statements is TRUE?

Lewis Production Company had the following projected information for 2011: What is the contribution margin ratio?

Zachary Plumbing Company has the following information for 2011: Required: Prepare a profit-volume graph identifying the following items:

In the Cost-Volume-Profit analysis, what are two ways management can deal with risk and uncertainty?

Information about the Harmon Company's two products includes: What is the total monthly sales volume in units required to break even when the sales mix in units is 70 percent Product X and 30 percent Product Y?

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

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

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