Describe how total variable costs and unit variable costs behave with changes in the level of activity.

Question

Want to see more full solutions like this?

Answer 1

Textbook Question

Chapter 21, Problem 1DQ

Describe how total variable costs and unit variable costs behave with changes in the level of activity.

Expert Solution & Answer

To determine

Cost Behavior: It refers to the method in which a cost changes with respect to the changes in its related activities. This method helps the management in estimating costs for decision making and predict future profits.

To describe: the behavior of the total variable costs and unit variable costs with changes in the level of activity.

Explanation of Solution

The total variable costs changes proportionately with respect to the changes in the level of activity. However, the unit variable costs remains constant irrespective to the changes in the level of activity.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Students have asked these similar questions

Kindly help me with general accounting question

Solve this question financial accounting

The following financial statement information is from five separate companies. Beginning of year Assets Liabilities Compan Compan Compan Compan Compan УА y B ус y D y E $ 55,000 $34,000 $24,000 $60,000 $1,19,00 24,500 21,500 9,000 40,000 ? End of year Assets Liabilities Changes during 58,000 40,000 ? 85,000 1,13,000 ? 26,500 29,000 24,000 70,000 the year Owner 6,000 1,400 9,750 ? 6,500 investments Net income (loss) 8,500 ? 8,000 14,000 20,000 Owner 3,500 2,000 5,875 0 11,000 withdrawals Compute the amount of liabilities for Company E at the beginning of the year. End of the year Assets = Liabilities + Equity $ 1,13,000 = $ 70,000 + $ 43,000 Statement of Owner's equity Equity, beginning of year $ 43,000 Add: Investment by owner 6,500 Add: Net Income 20,000 69,500 Less: Withdrawal by owner 11,000 Equity, end of year ?

Answer 2

Textbook Question

Chapter 21, Problem 1DQ

Describe how total variable costs and unit variable costs behave with changes in the level of activity.

Expert Solution & Answer

To determine

Cost Behavior: It refers to the method in which a cost changes with respect to the changes in its related activities. This method helps the management in estimating costs for decision making and predict future profits.

To describe: the behavior of the total variable costs and unit variable costs with changes in the level of activity.

Explanation of Solution

The total variable costs changes proportionately with respect to the changes in the level of activity. However, the unit variable costs remains constant irrespective to the changes in the level of activity.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 3

Textbook Question

Chapter 21, Problem 1DQ

Describe how total variable costs and unit variable costs behave with changes in the level of activity.

Expert Solution & Answer

To determine

Cost Behavior: It refers to the method in which a cost changes with respect to the changes in its related activities. This method helps the management in estimating costs for decision making and predict future profits.

To describe: the behavior of the total variable costs and unit variable costs with changes in the level of activity.

Explanation of Solution

The total variable costs changes proportionately with respect to the changes in the level of activity. However, the unit variable costs remains constant irrespective to the changes in the level of activity.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 4

Textbook Question

Chapter 21, Problem 1DQ

Describe how total variable costs and unit variable costs behave with changes in the level of activity.

Expert Solution & Answer

To determine

Cost Behavior: It refers to the method in which a cost changes with respect to the changes in its related activities. This method helps the management in estimating costs for decision making and predict future profits.

To describe: the behavior of the total variable costs and unit variable costs with changes in the level of activity.

Explanation of Solution

The total variable costs changes proportionately with respect to the changes in the level of activity. However, the unit variable costs remains constant irrespective to the changes in the level of activity.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 5

Textbook Question

Answer 6

Textbook Question

Answer 7

Expert Solution & Answer

To determine

Cost Behavior: It refers to the method in which a cost changes with respect to the changes in its related activities. This method helps the management in estimating costs for decision making and predict future profits.

To describe: the behavior of the total variable costs and unit variable costs with changes in the level of activity.

Explanation of Solution

The total variable costs changes proportionately with respect to the changes in the level of activity. However, the unit variable costs remains constant irrespective to the changes in the level of activity.

Answer 8

Expert Solution & Answer

To determine

Cost Behavior: It refers to the method in which a cost changes with respect to the changes in its related activities. This method helps the management in estimating costs for decision making and predict future profits.

To describe: the behavior of the total variable costs and unit variable costs with changes in the level of activity.

Explanation of Solution

The total variable costs changes proportionately with respect to the changes in the level of activity. However, the unit variable costs remains constant irrespective to the changes in the level of activity.

Answer 9

Expert Solution & Answer

Answer 10

Expert Solution & Answer

Answer 11

To determine

Cost Behavior: It refers to the method in which a cost changes with respect to the changes in its related activities. This method helps the management in estimating costs for decision making and predict future profits.

To describe: the behavior of the total variable costs and unit variable costs with changes in the level of activity.

Answer 12

Explanation of Solution

The total variable costs changes proportionately with respect to the changes in the level of activity. However, the unit variable costs remains constant irrespective to the changes in the level of activity.

Answer 13

Ch. 21 - Describe how total variable costs and unit...Ch. 21 - How would the following costs be classified...Ch. 21 - Describe how total fixed costs and unit fixed...Ch. 21 - In applying the high-low method of cost estimation...Ch. 21 - If fixed costs Increase, what would be the impact...Ch. 21 - An examination of the accounting records of...Ch. 21 - Prob. 7DQ Ch. 21 - Both Austin Company and Hill Company had the same...Ch. 21 - How does the sales mix affect the calculation of...Ch. 21 - What does operating leverage measure, and how is...

Describe how total variable costs and unit variable costs behave with changes in the level of activity.

Concept explainers

Videos

Explanation of Solution

Want to see more full solutions like this?

Chapter 21 Solutions