1. Which of the following is a variable? cost?

A. Direct materials cost B. Straightminus line depreciation expense C. Property taxes D. Salary of plant manager

2. Variable cost per? unit, within the relevant? range, will:

A. decrease as production increases. B. increase as production decreases. C. remain the same as production levels change. D. decrease as production decreases.

3. Which of the following statements is true of the behavior of total fixed? costs, within the relevant? range?

A.They will decrease as production decreases. B.They will increase as production decreases. C. They will decrease as production increases. D. They will remain the same as production levels change.

4. Assume that? John's cellphone service provider charges $ 7.00per month and $ 0.10per minute per call. If? John's current bill is $ 80.00, how many calling minutes did John? use?

A. 660 minutes B. 800 minutes C.730 minutes D.880 minutes

5. The relevant range of Orleans Company is between? 100,000 units and? 180,000 units per month. If the company produces beyond? 180,000 units per? month:

A.the fixed costs may? change, but the variable cost per unit will remain the same.

B.both the fixed costs and the variable cost per unit may change.

C.the fixed costs and the variable cost per unit will not change.

D. the fixed costs will remain the? same, but the variable cost per unit may change.

6. Which of the following is the right formula for calculating total mixed? cost?

A. Total mixed cost? = (Variable cost per unit x Number of? units) + Total fixed cost

B. Total mixed cost? = (Variable cost per unit? / Number of? units) + Total fixed cost

C. Total mixed cost? = (Variable cost per unit x Number of? units) minus Total fixed cost

D. Total mixed cost? = (Variable cost per unit? / Number of? units) minus Total fixed cost

7. The dollar amount that provides for covering fixed costs and then provides for operating income is? called:

A. contribution margin.

B. variable cost.

C. total cost.

D. margin of safety.

8. Contribution margin ratio is the ratio of contribution margin? to:

A. cost of goods sold.

B. total variable costs.

C. net sales revenue.

D. total fixed costs.

9. Which of the following is a period? cost?

A. Administrative cost

B. Direct materials cost

C. Manufacturing overhead

D. Direct labor cost

10. A(n) ________ groups cost by? behavior; that? is, costs are classified as either variable costs or fixed costs.

A. traditional income statement

B. absorption costing income statement

C. balance sheet

D. contribution margin income statement

11. Contribution margin ratio is equal? to:

A. fixed costs divided by contribution margin per unit.

B. net sales revenue minus variable costs.

C. contribution margin divided by net sales revenue.

D. net sales revenue per unit minus variable costs per unit.

12. Young Company has provided the following? information:

Price per unit $42

Variable cost per unit $12

Fixed costs per month $20000

Calculate the contribution margin per unit.

A. $ 54

B. $ 18

C. $ 30

D. $ 42

13. Pluto Company sold 2000units in October at a price of $ 35 per unit. The variable cost is $ 25 per unit. Calculate the total contribution margin.

A. $ 120000

B. $ 20000

C. $ 50000

D. $ 70000

14. Which of the following formulae is the right formula for calculating contribution margin? ratio?

A. Contribution margin ratio? = Contribution margin x Net sales revenue

B. Contribution margin ratio? = Contribution margin? + Net sales revenue

C. Contribution margin ratio? = Contribution margin minus Net sales revenue

D. Contribution margin ratio? = Contribution margin? / Net sales revenue

15. One of the assumptions of cost volume profit (CVP) analysis is that there are no changes in? the:

A. inventory levels.

B. accounts payable.

C. accounts receivables.

D. cash balance.

16. Margaret sells hand knit scarves at a flea market. Each scarf sells for $ 30. Margaret pays $ 40 to rent a vending space for one day. The variable costs are $ 20 per scarf. How many scarves should she sell each day in order to break? even?

A. 30 scarves

B. 2 scarves

C. 4 scarves

D. 3 scarves

17. ?________ is a? "what if" technique that estimates profit or loss results if selling? price, costs,? volume, or underlying assumptions change.

A. Sensitivity analysis

B. Operating leverage

C. High - low method of analysis

D. Contribution margin

18. When the total fixed costs? increases, the contribution margin per? unit:

A. increases.

B. remains the same.

C. decreases.

D. increases proportionately.

19. When the total fixed costs? increases, the breakeven? point:

A. remains the same.

B. decreases.

C. increases.

D. decreases proportionately.