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 .

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 .

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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PLEASE ANSWER ALL Write “True” if the statement is true and write “False” if the statement is false. If volume increases, both total variables and total fixed costs will increase. Decrease in the level of activity will cause total variable and total fixed costs to decrease. When graphed, total variable costs and total fixed costs are both assumed to be linear withinthe relevant range.
The break-even point is that level of activity where: Select one: O a. sales revenue eguals fixed cost. O b. variable cost equals fixed cost. Oc total contribution margin equals the sum of variable cost plus fixed cost. O d. sales revenue equals total variable.cost Oe. contribution margin equals fixed cost.
Which of the following is true of fixed and variable costs? Volume changes will not change the relationship between fixed and variable costs. Fixed costs are fixed in total, but vary per unit; variable costs vary in total, but are fixed per unit. As sales increase, the contribution margin percentage increases. O The relationship between sales, variable costs, and the contribution margin does not change when the sales price per unit changes. The contribution margin is what remains after fixed costs have been subtracted from total sales.
When the level of activity decreases, variable cost will increase or decrease ?
Within the relevant range, as volume of activity increases a. Total fixed costs remain the sameb. Fixed cost per unit decreasesc. Variable cost per unit remains the samed.Total variable costs increasese. all of the above
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.
Variable costs are the costs remain constant in 'total" amount over a wide range of activity for a specified period of time; i.e., these do not increase or decrease when the volume of production changes. Select one: O True O False
Which of the following is the difference between variable costs and fixed costs? (CMA adapted) Multiple Choice Variable costs per unit are fixed and fixed costs per unit are variable, over the relevant range. Variable costs per unit fluctuate and fixed costs per unit remain constant. Total variable costs are variable over the relevant range and fixed in the long term, while fixed costs never change. Variable costs per unit change in varying increments, while fixed costs per unit change in equal units.
What effect does an increase in sales price have on contribution margin? An increase in fixed costs? An increase in variable costs?
Explain why is variable cost said to constant and fixed costs are said to fluctuate in relation to production? And what determines over and under absorption in production?
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