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Exam 19: Cost-Volume-Profit Analysis

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Question 61

True/False

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Rental charges of $40,000 per year plus $3 for each machine hour over 18,000 hours is an example of a fixed cost.

A) True
B) False

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Question 62

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What was Rusty Co.'s weighted average unit contribution margin?

A) $60.00
B) $20.00
C) $40.00
D) $22.50

E) A) and D)
F) All of the above

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Question 63

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Global Publishers has collected the following data for recent months: Month Issues published Total cost March 20,500 $20,960 April 21,800 22,464 May 17,750 18,495 June 21,200 21,395 ​ Required: (a)Using the high-low method,find variable cost per unit,total fixed costs,and the total cost equation. (b)What is the estimated cost for a month in which 19,000 issues are published?

Cost behavior refers to the manner in which a cost changes as the related activity changes.

The Rocky Company reports the following data: ​ ​ Rocky Company's operating leverage is

The Waterfall Company sells a product for $150 per unit.The variable cost is $80 per unit,and fixed costs are $270,000. ​ Determine the (a)break-even point in sales units,and (b)break-even points in sales units if the company desires a target profit of $36,000.Round your answer to the nearest whole number.

Cordell,Inc.has an operating leverage of 3.Sales are expected to increase by 9% next year.What is the expected change in operating income next year?

Assuming that last year's fixed costs totaled $960,000,what was Carter Co.'s break-even point in units?

In order to choose the proper activity base for a cost,managerial accountants must be familiar with the operations of the entity.

The manufacturing cost of Mocha Industries for three months of the year are provided below: ​ Using the high-low method,determine the (a)variable cost per unit,and (b)the total fixed costs.

A firm operated at 90% of capacity for the past year,during which fixed costs were $420,000,variable costs were 40% of sales,and sales were $1,000,000.Operating profit was

If fixed costs are $600,000 and the unit contribution margin is $40,what is the break-even point if fixed costs are increased by $90,000?

Variable costs are costs that vary on a per-unit basis with changes in the activity level.

If fixed costs are $561,000 and the unit contribution margin is $8.00,what is the break-even point in units if variable costs are decreased by $0.50 a unit?

When Isaiah Company has fixed costs of $120,000 and the contribution margin is $30,the break-even point is

If fixed costs are $450,000 and the unit contribution margin is $50,the sales necessary to earn an operating income of $50,000 are 10,000 units.

If direct materials cost per unit decreases,the amount of sales necessary to earn a desired amount of profit will decrease.

If fixed costs are $650,000 and the unit contribution margin is $30,the sales necessary to earn an operating income of $30,000 are 14,000 units.

Variable costs as a percentage of sales for Lemon Inc.are 80%,current sales are $600,000,and fixed costs are $130,000.How much will operating income change if sales increase by $40,000?

What was Carter Co.'s unit contribution margin of E?