All other things the same, which of the following would be true of the contribution margin and variable costs of a company with high fixed costs and low variable costs as compared to a company with low fixed costs and high variable costs?   Contribution Margin Variable Costs A. Higher Higher B. Lower Higher C. Higher Lower D. Lower Lower     Option A     Option B     Option C     Option D

Q: Operating leverage predicts the effects of a given fixed cost on operating income when: Group of…

A: The objective of the question is to understand when operating leverage can predict the effects of a…

Q: ssume there is a reduction in the selling price and all other CVP parameters remain constant. This…

A: The contribution margin is calculated as the difference between the sales and variable costs. The…

Q: Before a company reaches the breakeven point Select one: a. The fixed cost is equal to zero b. The…

A: Contribution is calculated as Sales less variable costs. Sale price is the price at which the…

Q: What is the internal rate of return on an investment with the following cash flows? Year 10 1 2 13…

A: The IRR is a measure of a project’s profitability. It uses the NPV formula to find the maximum…

Q: If only the selling price per unit of a product increases (variable cost per unit and total fixed…

A: CVP analysis, or cost-volume-profit analysis, is a management accounting technique used to analyze…

Q: Variable costs _______  (pick all that apply) Group of answer choices 1) in total, change in direct…

A: Variable costs are the expenditure incurred on production of goods which changes in direct…

Q: Which of the following statements accurately describes the "relevant range?" a. The operation…

A: The relevant range is production range in which fixed costs remain constant. Fixed cost is a cost…

Q: Break-even analysis is one type of cost-volume-profit analysis. © True O False

A: The break even sales are the sales where business earns no profit no loss during the period.  The…

Q: What is the major benefit of Breakeven Analysis? AB A. B. C. OP D. It allows you to know how much…

A: Break-even analysis in economics, business, and cost accounting refers to the point at which total…

Q: Which of the following does not represent a cost-volume-profit analysis equation? a. Contribution…

A: Your choice is incorrect because option b. Is represent a cost volume profit analysis equation. The…

Q: 6. What will be the impact on a company's profit if sales mix shifts between low margin and high…

A: Sales mix represents the proportion of sales of each product in relation with the total sales of the…

Q: Historical cost numbers are usually harder than market value numbers select one :   True, or ,…

A: Historical cost: It is the cost of acquisition or say it is initial cost when customer acquire the…

Q: 21. If variable selling and administrative costs increased, how would the gross margin and…

A: Variable selling and administrative costs are those selling and admin costs which will be changed…

Q: “Companies should always make and sell all products whose selling prices exceed variable costs.”…

A:

Q: The degree of operating leverage Select one: O a. can be computed by dividing total contribution…

A: Leverage is the risk that a company bears.

Q: Discuss possible strategies of the company to decrease breakeven point, Contribution margin, and…

A: Breakeven point: Formula for breakeven point (in units) = Fixed CostsContribution Margin…

Q: revenues equal total fixed costs e given answers on margin equals total costs revenues equal total…

A: A CVP analysis is used to determine the sales volume required to achieve a specified profit level.…

Q: Firms with relatively high nonfinancial fixed costs are said to have a highdegree of what?

A: DOL (degree of operating leverage) is a multiple that estimates how much a firm's operating income…

Q: Which of the following performance measures will increase if inventory decreases and all else…

A: Return on investment measures the net earned on the assets employed by the business.

Q: At the breakeven point Select one: O a. Sales will be equal to variable costs plus fixed costs b.…

A: Formula: Break even point in units = Fixed costs / contribution margin Contribution margin means…

Q: Which of the following would lead to the breakeven point of a product shifting to the left on a…

A: Break-even analysis is done in order to find out at what point the total cost will be equal to the…

Q: The break-even point is that at which: Select one: O A. The level of activity at which the business…

A: Solution:- Break-even point is the point where the total costs of a business are equal to the total…

Q: If XYZ Company sells unit outputs that exceed the breakeven point, a. there will be an increase in…

A: CVP investigation takes a goose at the impact of deals volume minor departure from prices and…

Q: market value

A: Market value refers to the estimated worth of asset, which is based on the willingness of the buyer…

Q: Which of the following statements is/are true regarding the impact of a company's cost structure?…

A: Cost structure is the combination of various type of costs which are incurred by the entity for…

Q: Henderson Farms reports the following results for the month of November: Sales (10,000 units)…

A: Income statement is a financial statement that shows profitability, total revenue and total expenses…

Q: A firm can reduce its breakeven volume by: decreasing fixed costs. B) decreasing contribution…

A: The objective of the question is to identify the correct option that can help a firm reduce its…

Q: The profit maximizing condition for a purely competitive firm is when. Price elasticity of demand is…

A: The correct answer for the above mentioned question is given in the following steps for your…

Q: When the activity level declines within the relevant range, what should happen with respect to the…

A: The company running its operations incurs both variable costs and also fixed costs. The variable…

Q: Which project would be least sensitive to a change in directly attributable fixed costs if the…

A: The formula to determine the profits is as follows:Profits = Contribution Margin - Fixed CostsSo,…

Q: A firm can reduce its breakeven volume by: decreasing fixed costs. B) decreasing contribution…

A: The objective of the question is to identify the correct option that can help a firm reduce its…

Q: Which of the following statements about operating leverage is NOT true? Group of answer choices…

A: The objective of the question is to identify the incorrect statement about operating leverage among…

Q: Compared to companies that have a cost structure that is mainly comprised of fixed costs, companies…

A: Operating income shows that how revenue leads to growth in operating income. It is a tool to measure…

Q: Degree of operating leverage (DOL) measures the sensitivity of OCF in response to changes of The…

A: We have formula,Degree of operating leverage(DOL) = % change in operating income/% change in sales

Q: If total fixed costs increase, while selling price per unit and variable cost per unit remain the…

A: Break even point = fixed cost / ( sales price per unit -variable cost per unit if fixed cost…

Q: When is the stock value high in absorption costing than marginal costing? a. None of the options b.…

A: Actually b and C both options are correct.  Because, stock under absorption costing always higher…

Q: The cost-volume-profit analysis for a breakeven chart does not assume Group of answer choices Some…

A: Contribution means the difference between the selling price and variable cost . Fixed cost remain…

Q: Which one of the following statement is not correct? O Both fixed and variable costs influence…

A: The incorrect statement is "opoortunity costs are only considered when resources are limited" This…

Pricing

Pricing is used as a term in finance and economics, pricing is the process of fixing a value for a product or a service. Pricing establishes a value for a product or service that the customer has to pay. A business can choose from different strategies while deciding to set prices.