ed, hich of the following statements is true? 6. Once the break-even point is A) Variable expenses will remain constant in total. The contribution margin ratio begins to decrease. C) Operating income will increase by the unit contribution margin for each additional D) item sold. The total contribution margin changes from negative to positive.
ed, hich of the following statements is true? 6. Once the break-even point is A) Variable expenses will remain constant in total. The contribution margin ratio begins to decrease. C) Operating income will increase by the unit contribution margin for each additional D) item sold. The total contribution margin changes from negative to positive.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
100%
Transcribed Image Text:6. Once the break-even point is reached, which of the following statements is true?
A) Variable expenses will remain constant in total.
The contribution margin ratio begins to decrease.
Operating income will increase by the unit contribution margin for each additional
B)
C)
item sold.
D) The total contribution margin changes from negative to positive.
7. The break-even in units sold will decrease if there is an increase in which of the
following?
A) Total fixed expenses.
B) Selling price.
C) Unit sales volume.
D) Unit variable expenses.
8. Which of the following is normally included in product cost under the variable costing
method?
A) Prime cost and all conversion cost.
B) Direct materials cost, direct labour cost, but not manufacturing overhead cost.
Direct materials cost, direct labour cost, and variable manufacturing overhead cost.
C)
D) Prime cost but not conversion cost.
9. Regarding job-order costing and process costing:
A) Job-order costing is better in the long run
B)
Are both suited to companies with long production runs of products that are
identical
C) Can both be used by the same company but in different circumstances
D) Are not acceptable for external financial accounting needs
10. The term "gross margin" for a manufacturing company refers to the excess of sales over
which of the following?
A) Variable costs, excluding variable selling and administrative expenses.
B) Cost of goods sold, including fixed manufacturing overhead.
Cost of goods sold, excluding fixed manufacturing overhead.
C)
D) All variable costs, including variable selling and administrative expenses.
11. An allocated portion of fixed manufacturing overhead is included in product costs under
which of the following?
Absorption Costing
A) No
B) Yes
C) No
D) Yes
Variable Costing
Yes
Yes
OGS
No
No
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps
Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education