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.

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.

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter3: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 14MC: When fixed costs increase and all other variables remain unchanged, the contribution margin will A....

See similar textbooks

Related questions

Q: With respect to total fixed costs, which of the following statements is true? a They will…

A: Cost refers to the expenditure incurred by an individual or entity in process of creation of goods…

Q: What is characteristic of variable costs within the relevant range? A. Decrease in total as as…

A: Variable costs within the relevant range has following characteristics :- Total variable cost…

Q: The cost-volume-profit (CVP) profit-planning model assumes that over the relevant range of activity:…

A: The objective of the question is to identify the correct assumption of the cost-volume-profit (CVP)…

Q: Which of the following is correct concerning reactions to INCREASES in activity? Variable Cost Per…

A: Expenses that change in direct proportion to the volume of output or activity in a business are…

Q: The break-even point is that level of activity where: Select one: O a. profit equals to zero. O b.…

A: Break-Even Point: It is the point of sales at which entity neither earns a profit nor suffers a…

Q: Which one of the following is not an assumption of CVP analysis? The behavior of costs and…

A: Cost Volume profit analysis is one of the means to find out how fixed costs and variable costs…

Q: Variable Costs are costs that change in direct proportion to changes in activity level. (b) Unit…

A: Variable costs: These are the costs that vary depending on the volume of the activity. Fixed costs:…

Q: When the level of activity decreases, variable cost will increase or decrease ?

A: Variable costs will decrease when the level of activity decreases. This is because many variable…

Q: Variable costs are costs that: vary inversely proportional with changes in activity Remain constant…

A: Variable cost refers to the cost that varies in total amount with the changes units produced by the…

Question

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

Expert Solution

This question has been solved!

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

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

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

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.
Which of the following cost behavior assumptions is true? (You may select morethan one answer.)a. Variable costs are constant if expressed on a per unit basis.b. Total variable costs increase as the level of activity increases.c. The average fixed cost per unit increases as the level of activity increases.d. Total fixed costs decrease as the level of activity decreases
(a) Variable Costs are costs that change in direct proportion to changes in activity level. (b) Unit variable cost remain constant regardless of the level of activity a. Both statements are true b. Both statements are false c. Statement A is true and statement B is false d. Statement A is false and statement B is true
Within the relevant range:a. both total variable costs and total fixed costs will remain constant.b. both total variable costs and total fixed costs fluctuate.c. fixed costs per unit will remain constant and variable costs per unit will fluctuate.d. variable costs per unit will remain constant and fixed costs per unit will fluctuate.
1.) Explain the effects of an increase in the volume of activity on the following costs. (Assume volume remains within the relevant range .) a. Total variable costs. b. Variable cost per unit. Total fixed cpst . d. Fixed cost per unit. e. Total semi variable costs. f. Semi variable cost per unit .
Show how each of these costs will behave as the volume of activity decreases. Variable cost per unit Total variable cost Fixed cost per unit Total fixed cost A. Increase B. Decrease C. Remains the same
When the level of activity increases, total fixed costs a. decrease. b. remain the same. c. increase. d. change, but the direction depends on the specific situation.
Which of the following best describes a variable cost? A cost that: a. Represents a fixed proportion of total costs b. Has a direct relationship with outputc. Is sometimes also known as an indirect cos d. Falls on average, as output increases.
Within the relevant range: Select one: O A. variable cost per unit decreases as production decreases. O B. fixed cost per unit increases as production decreases. O C. fixed cost per unit decreases as production decreases. O D. variable cost per unit increases as production decreases.
Variable costs are costs that: A.vary inversely proportional with changes in activity B.Remain constant as activity changes C.Decrease on a per unit basis as activity increases D.Remain constant on a per unit basis as activity changes
Which of the following statements is TRUE? O A. Variable costs per unit decrease as production levels increase. O B. Fixed costs per unit decrease as production levels increase. OC. Total indirect costs are always greater than total direct costs. O D. Direct costs are usually overheads.
What is characteristic of variable costs within the relevant range? A. Decrease in total as as output increases B. Stay constant in total as output increases C. Decrease on a per-unit basis as output increases D. Stay constant on a per-unit basis as output changes