1.

Assume the following information:

Variable cost ratio 65%

Total fixed costs $ 85,400

What volume of sales dollars is needed to break even (Round to the nearest dollar if necessary)?

A) $244,000

B) $131,385

C) $342,000

D) $189,778

2.

Which of the following is FALSE about the contribution format income statement?

A) It organizes expense items based on a company's functions, such as production, marketing and administration.

B) It is useful for a managers internal decision-making, such as the CVP analysis.

C) It is not an acceptable format for the companys external financial reporting purpose.

D) It is also called cost behavior-based income statement.

3.

Which of the following cost classification is typically used in process costing?

A) Direct materials and conversion costs

B) Conversion costs and applied overhead

C) Prime costs and applied overhead

D) Direct materials, direct labor, and applied overhead