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Exam 19: Cost-Volume-Profit Analysis

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Question 21

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Thompson Company manufactures and sells cookware.Because of current trends,it expects to increase sales by 15% next year.If this expected level of production and sales occurs and plant expansion is not needed,how should this increase affect next year's total amounts for the following costs. ​ Variable Costs Fixed Costs Mixed Costs

A) ​ increase increase increase
B) ​increase no change increase
C) ​ no change no change increase
D) decrease increase increase

E) All of the above
F) B) and D)

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Question 22

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Which of the following conditions would cause the break-even point to decrease?

A) total fixed costs increase
B) unit selling price decreases
C) unit variable cost decreases
D) unit variable cost increases

E) A) and B)
F) None of the above

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Question 23

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The relative distribution of sales among the various products sold by a business is the

Which of the following conditions would cause the break-even point to increase?

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

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

Racer Industries has fixed costs of $900,000.Selling price per unit is $250,and variable cost per unit is $130. Required: (a)How many units must Racer sell in order to break even? (b)How many units must Racer sell in order to earn a profit of $480,000? (c)A new employee suggests that Racer Industries sponsor a 10K marathon as a form of advertising.The cost to sponsor the event is $7,200.How many more units must be sold to cover this cost?

Manley Co.manufactures office furniture.During the most productive month of the year,4,500 desks were manufactured at a total cost of $86,625.In its slowest month,the company made 1,800 desks at a cost of $49,500.Using the high-low method of cost estimation,total fixed costs are

O'Boyle Co.'s fixed costs are $256,000,the unit selling price is $36,and the unit variable costs are $20,what is the break-even sales (units) ?

For the past year,Pedi Company had fixed costs of $70,000,unit variable costs of $32,and a unit selling price of $40.For the coming year,no changes are expected in revenues and costs,except that property taxes are expected to increase by $10,000.Determine the break-even sales (units)for (a)the past year and (b)the coming year.

If fixed costs are $500,000,the unit selling price is $55,and the unit variable costs are $30,what is the break-even sales (units) if fixed costs are increased by $80,000?

Lee Industry sales are $525,000,variable costs are 53% of sales,and operating income is $19,000.What is the contribution margin ratio?

The difference between the current sales revenue and the sales at the break-even point is called the

Given the following costs and activities for Dance Company electrical costs,use the high-low method to calculate Dance's variable electrical costs per machine hour. ​

The ratio that indicates the percentage of each sales dollar available to cover the fixed costs and to provide operating income is termed the contribution margin ratio.

If yearly insurance premiums are increased,this change in fixed costs will result in an increase in the break-even point.

What was Carter Co.'s unit selling price of E,with E representing one overall "enterprise" product?

Charlotte Co.has budgeted salary increases to factory supervisors totaling 9%.If selling prices and all other cost relationships are held constant,next year's break-even point

When Isaiah Company has fixed costs of $120,000 and the contribution margin is $30,the break-even point is

The graph of a variable cost when plotted against its related activity base appears as a