Survey Of Accounting
4th Edition
ISBN: 9780077862374
Author: Edmonds, Thomas P.
Publisher: Mcgraw-hill Education,
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Chapter 11, Problem 12Q
To determine
Whether all the costs of the company are variable because if a business concludes operations then their cost drops to zero
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Students have asked these similar questions
if costs are two high:
Select one:
a. Company loses work
b. Company loses money
C. It means error in estimation
d. All the above
Which one of the following statement is not correct?
O Both fixed and variable costs influence short-term decision-making.
O Short-term decision-making is all about analysing those costs that will change as a result of taking a particular action.
O Opportunity costs are only considered when resources are limited.
O Break-even analysis is used to determine how many units of a product or a service a business has to sell to cover all its
costs.
When companies consider outsourcing a product, fixed costs are always irrelevant.
Question 31 options:
True
False
Chapter 11 Solutions
Survey Of Accounting
Ch. 11 - 1.Define fixed cost and variable cost and give an...Ch. 11 - Prob. 2QCh. 11 - 3.Define the term operating leverage and explain...Ch. 11 - Prob. 4QCh. 11 - Prob. 5QCh. 11 - 6.If volume is increasing, would a company benefit...Ch. 11 - Explain the risk and rewards to a company that...Ch. 11 - 9.Are companies with predominately fixed cost...Ch. 11 - 10.How is the relevant range of activity related...Ch. 11 - Which cost structure has the greater risk?...
Ch. 11 - 14.The president of Bright Corporation tells you...Ch. 11 - Prob. 12QCh. 11 - Prob. 13QCh. 11 - Prob. 14QCh. 11 - Prob. 15QCh. 11 - Prob. 16QCh. 11 - Prob. 17QCh. 11 - Prob. 1ECh. 11 - Prob. 2ECh. 11 - Prob. 3ECh. 11 - Prob. 4ECh. 11 - Prob. 5ECh. 11 - Prob. 6ECh. 11 - Prob. 7ECh. 11 - Prob. 8ECh. 11 - Prob. 9ECh. 11 - Prob. 10ECh. 11 - Moore Entertainment sells souvenir T-shirts at...Ch. 11 - Prob. 12ECh. 11 - Prepare an income statement using the contribution...Ch. 11 - Prob. 14ECh. 11 - Prob. 15ECh. 11 - Prob. 16ECh. 11 - Prob. 17ECh. 11 - Prob. 18ECh. 11 - Prob. 19ECh. 11 - Prob. 20ECh. 11 - Prob. 21PCh. 11 - Prob. 22PCh. 11 - Problem 2-19A Context-sensitive nature of cost...Ch. 11 - Prob. 24PCh. 11 - Prob. 25PCh. 11 - Prob. 26PCh. 11 - Prob. 27PCh. 11 - Prob. 28PCh. 11 - Prob. 29PCh. 11 - Prob. 1ATCCh. 11 - Prob. 2ATCCh. 11 - Prob. 3ATCCh. 11 - Prob. 4ATCCh. 11 - Prob. 5ATC
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- 1)What is cost behavior analysis? and Why is cost behavior analysis important to management? 2)“Break-even analysis is of limited use to management because a company cannot survive by just breaking even.” Do you agree? Agree or not agree, please describe your line of reasoning.arrow_forwardWhich is not true? At break-even point, A. profit equals zeroB. gross profit equals operating expensesC. contribution margin equals fixed costsD. total revenue equals total costsE. none of the above.arrow_forwardWhich of the following is not correct? At break-even A. Fixed costs equals contribution margin B. Profit equals zero C. Sales equal total costs D. Gross profit equals zeroarrow_forward
- A cost that cannot be changed because it arises from a past decision and is irrelevant to future decisions is a. An uncontrollable cost. d. An opportunity cost. b. An out-of-pocket cost. e. An incremental cost. c. A sunk cost.arrow_forward15. 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.arrow_forward4. A cost driver is: an indirect cost that is essential to the business. a factor that causes variations in a cost. the largest single category of cost in a company. a fixed cost that cannot be avoided.arrow_forward
- Which of the following occurs if a company experiences an increase in its fixed costs? Select one: O a. Net income would decrease. O b. The contribution margin would increase. Oc The contribution margin would decrease. Od. The break-even point would decra2se, Oe. More than one.of the answers, would.occur.arrow_forwardThe break-even point is that at which: Select one: O A. The level of activity at which the business operates most economically B. The level of activity at which the business neither makes a profit nor a loss O C. The fixed costs are the lowest O D. The variable cost per unit is minimisedarrow_forward7. Which of the following is the best definition of a variable cost? A. A variable cost is one which is directly traceable to an activity of the business for which the cost will be used. B. A variable cost is one which is associated with goods or services purchased, or produced, for sale to customers. C. A variable cost is one which changes with changes in the level of activity, over a defined period of time. D. A variable cost is one which is spread over a number of activities of the business for which costs are to be determined.arrow_forward
- Which one of the following statement is not correct? Group of answer choices -Opportunity costs are only considered when resources are limited. -Break-even analysis is used to determine how many units of a product or a service a business has to sell to cover all its costs. -Both fixed and variable costs influence short-term decision-making. -Short-term decision-making is all about analysing those costs that will change as a result of taking a particular action.arrow_forwardB6. The difference between contribution margin and income from operations is ________.a. net incomeb. variable costsc. fixed costsd. None of these choices are correct.arrow_forwardQuestion 8?arrow_forward
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