Question 1

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 2

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 3

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

Question 4

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.E) A) and C)
F) B) and C)

Question 5

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

Accepted Answer

A) True 
 B)False

Question 6

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

Accepted Answer

A) True 
 B)False

Question 7

A low operating leverage is normal for highly automated industries.

Accepted Answer

A) True 
 B)False

Question 8

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

Accepted Answer

A) True 
 B)False

Question 9

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

Accepted Answer

A) True 
 B)False

Exam 11: Cost-Volume-Profit Analysis

For the purpose of analysis, mixed costs are generally:

Correct Answer
verified

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

Correct Answer
verified

A low operating leverage is normal for highly automated industries.

Correct Answer
verified

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%.

Correct Answer
verified

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

Correct Answer
verified

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

Correct Answer
verified

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

Correct Answer
verified

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

Correct Answer
verified

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

Correct Answer
verified

Exam 11: Cost-Volume-Profit Analysis

For the purpose of analysis, mixed costs are generally:

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

A low operating leverage is normal for highly automated industries.

Correct AnswerverifiedShow Answer

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%.

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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