The breakeven point decreases if: a. the variable cost per unit increases b. the contribution margin per unit decreases c.none of the given answers d. the selling price per unit increases . e. the total fixed costs increase

The breakeven point decreases if: a. the variable cost per unit increases b. the contribution margin per unit decreases c.none of the given answers d. the selling price per unit increases . e. the total fixed costs increase

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

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: contribution margin will decrease if sales remain the same and:

A: Contribution Margin: The Contribution Margin is also can be treated on a gross or per unit basis.…

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: Which of the following conditions would cause the break-even point to increase? Oa. total fixed…

A: The break even point the fixed cost of the production of the material is equal to the difference in…

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: Suppose that the elasticity of demand at a given price level is E(p)=.8. What does that mean? Select…

A: Answer -The company should lower the prices to raise revenues. Since 0<E(p)<1, demand is…

Q: The conventional CVP (Cost-volume and profit) analysis has some underlying assumptions regarding…

A: Cost volume profit analysis - This analysis shows how a change in variable cost and change in fixed…

Q: 1. Fixed cost per unit Remains constant Increases when output increases Decreases…

A: Cost: It refers to the aggregated amount that is spent on manufacturing a product.

Q: QUESTION 8 If Nim Com Soup, Inc.'s, variable costs per unit decrease, while selling price per unit…

A: Since, Selling price - Variable Cost = contribution margin

Q: When output (Q) is increasing in the short run, Marginal Cost will be O decreasing O staying the…

A: Marginal cost (MC) refers to the additional cost incurred when producing one additional unit of…

Q: true or false, An increase in total fixed costs lowers the break-even point.

A: Formula: Break even point = Fixed costs / Contribution margin per unit. Contribution margin per unit…

Q: The breakeven point increases if: O a. the selling price per unit increases O b. the total fixed…

A: 1) D is the correct answer Because The break-even point can increase once the number of fixed prices…

Q: Fixed cost per unit of output decreases as volume increases. True or False True False

A: Any organization generally have two types of expenses - Fixed costs and variable costs. Fixed costs…

Q: profit graph which of the following is not true? A.Total revenue will always be $0 at zero sales…

A: Profit graph is a graph shows the profit and different level of sales in comparison to the cost…

Q: 2. Consider the production functions given below: a. Suppose that the production function faced by a…

A: The objective of the question is to analyze the production function of a bread producer, determine…

Q: when the contribution margin ratio increases

A: Option A is wrong because break-even point decreases when the contribution margin ratio increases.…

Q: On the cost-volume-profit graph, which of the following would result into an increase in the…

A: Answer

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: When the volume of production is higher than the volume of production at break-even point, than the…

A: Answer - Correct Option is Option C) current amount of profit

Q: The contribution margin per unit will increase.

A: Fixed costs are costs or expenses in the economics and business sectors that do not alter with…

Q: 1. The most likely strategy to reduce the break-even point would be to a. Increase both the fixed…

A: A Break-even point is a point at which a company is able to cover all its expenses with the present…

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: If Mazoon Company sells unit outputs that exceed the breakeven point there will be a profit .a total…

A: Break even point means a point where firm is neither earning profit nor incurring any loss. For…

Q: Which of the following statements about CVP analysis is true? O a. Operating income calculations in…

A: Selling price: Selling price is a price set by the supplier at which he is ready to sell his…

Q: When variable costs per unit increases, the gross margin will ceteris paribus. increase O decrease…

A: After deducting all costs directly related to producing the goods or services for sale, a company's…

Q: Which of the following assumptions of the CVP graph is not true? Multiple Choice Costs are linear.…

A: CVP stands forc cost volume price it is a way to find out that how changes in variable and fixed…

Q: ed, hich of the following statements is true? 6. Once the break-even point is A) Variable expenses…

A: The Break-even point is a situation in which there is neither profit nor loss. In other words, this…

Q: On the breakeven graph, the fixed cost line a) moves to the right as fixed cost increase.…

A: SOLUTION- BREAK EVEN GRAPH- IT IS A GRAPH WHICH PLOT TOTAL SALES AND TOTAL COST CURVES OF A COMPANY…

Q: In the long run, the long-run average cost curve _____, whereas in the very long run, the long-run…

A: a. none of the above

Q: Which one of the following statements is correct? O a. Avariable cost is a cost whose cost per unit…

A: The cost can be classified into two categories i.e fixed cost and variable cost. The FIxed cost…

Q: On the cost-volume-profit graph, which of the following would result into a decrease in the…

A: CVP analysis: This analysis helps to evaluate how the changes made in cost and volume do affect the…

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 is true of fixed and variable costs? Volume changes will not change the…

A: Fixed cost includes expenses that remain constant irrespective of the level of outputs, like rent,…

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

A: The break-even points indicate where the revenues are equal to costs. It means there is neither…

Q: breakeven point i

A: We know that Break Even point is the point where the entity does not make any profit or loss That is…

Q: Holding other factors constant, a company's contribution margin per unit will increase with: O a.…

A: The contribution margin represents the portion of sales that is left after the deduction of variable…

Q: On the cost-volume-profit graph, which of the following would result into an increase in the…

A: Break Even Point is a point at which firm incurred no loss and earned No Profit. Break Even Point…

Question

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

On the costvolume - profit graph which of the following would result into a decrease in the breakeven point (Assuming other factors remain unchanged )? a. Decrease in number of units sold b.Decrease in selling price per unit c. Increase in fixed costs d. Decrease in variable cost per unit e. None of the given answers
Variable costs and fixed costs can best be described by which of the following when production levels decrease? Total fixed costs decrease, but fixed costs per unit stay constant. Fixed costs per unit stay constant, but variable costs per unit decrease. Fixed costs per unit increase, but variable costs per unit stay constant. Total variable costs stay constant , but variable costs per unit decrease .
15. If the total contribution margin increases and fixed costs do not change, then net income can be expected to a. decrease by an equal amount. b. increase by an amount equal to the increase in contribution margin times the CM ratio. c. increase by an equal amount. d. none of these.
5. Which of the following statements is correct: A. total fixed cost remain constant while variable cost as total increases as level of activities decreases. B. fixed cost per unit and total variable costs increases as level of activities increases. C. variable cost per unit and total fixed cost remain constant as level of activities increases. D. fixed cost per unit remain constant and variable cost per unit decreases as level of activities decreases. W Pe
Break-even analysis assumes over the relevant range that Group of answer choices total variable costs are linear. fixed costs per unit are constant. total variable costs are nonlinear. total revenue is nonlinear.
Which of the following costs are always incremental and relevant in decision analysis? a) Opportunity costs and sunk costs b) Avoidable costs and opportunity costs c) Only avoidable costs d) Avoidable costs and sunk costs Which of the following will increase a company's breakeven point? a) reducing its total fixed costs b) increasing the selling price per unit c) increasing variable cost per unit d) increasing contribution margin per unit
:Holding other factors constant, a company's contribution margin per unit will increase with All answers given are NOT correct .a O any increase in variable cost per unit .b O .any increase in quantity sold .c O any increase in the selling price per unit .d O increase in its total fixed costs .e O
If sales volume increases and all other factors remain constant, then the: O contribution margin ratio will increase. O margin of safety will increase. break-even point will decrease. O net operating income will decrease.
3. The result of the fixed expenses divided by the unit contribution margin refers to the: * Margin of safety Contribution margin ratio Break-even point in unit sales Break-even point in dollar sales None of the above 4. Which of the following statements is correct concerning the variable expenses per unit within the relevant range? * The variable expenses per unit remain constant as the activity changes The variable expenses per unit increase as the activity increases The variable expenses per unit decrease as the activity increases The variable expenses per unit can O increase or decrease as the activity changes
As the level of activity increases, how will a mixed cost in total and per unit behave? A) B) (C) D) E) In Total Increase Increase Increase Decrease Decrease Multiple Choice Choice A Choice B Choice C Choice D Per Unit Decrease Increase No effect Increase No effect
Holding other factors constant, a company's contribution margin per unit will increase with: a. All answers given are NOT correct. O b. any increase in quantity sold. С. any increase in variable cost per unit O d. any decrease in the selling price per unit e. increase in its total fixed costs
Assuming all other things are the same, selling price per unit must have even point. Select one: O A. remained the same O B. increased O C. increased first, then decreased O D. decreased if there was a decrease in the break-