10. Which of the following would a manufacturing company expect to experience as it automates and shifts from variable expenses to fixed expenses? A. A lower margin of safety percentage B. A higher contribution margin ratio C. A steeper total expenses line on its cost-volume-profit graph D. Both A and B above

11. In the middle of the year, the price of Luvdisc Corporation's major raw material increased by 8%. How would this increase affect the company's break-even point and margin of safety? Break-even point Margin of safety A. Increase Increase B. Decrease Decrease C. Decrease Increase D. Increase Decrease

12. Which of the following would not affect the break-even point? A. total fixed expenses B. selling price per unit C. number of units sold D. variable expense per unit

13. Lopunny Shoe Company is a single product firm. Lopunny is predicting that a price increase next year will NOT cause unit sales to decrease. What effect would this price increase have on the following items for next year? Contribution Margin Ratio Break-even Point A. Increase Decrease B. Decrease Increase C. Decrease No effect D. Increase No effect

14. For the past 8 months, DLSU Inc has experienced a steady increase in its cost per unit even though total costs have remained stable. This cost per unit increase may be due to ________________ costs because the level of activity at the firm is ________________ . A. fixed, decreasing B. fixed, increasing C. variable, increasing D. variable, decreasing

15. When the activity level is expected to DECLINE within the relevant range, what effects would be anticipated with respect to each of the following? Fixed Costs per unit Variable Costs per unit A. Increase Increase B. Increase No change C. No change No change D. No change Increase De La Salle University Basic Management Accounting (ACCCOB3) Long Quiz No. 3 - For the 1st Term 2020-2021 Page | 3 of 5 O ONLINE

16. A 15% increase in production volume will result in a: A. 15% increase in total mixed costs. B. 15% increase in total variable costs. C. 15% increase in the variable cost per unit. D. 15% increase in total manufacturing costs.

17. RVR Company has a single product and currently has a degree of operating leverage of 5. Which of the following will increase the degree of operating leverage? An increase in Variable Expenses An increase in Fixed Expenses A. Yes Yes B. No Yes C. Yes No D. No No

18. Oshawatt Lighting Company has a normal range of production volumes between 100,000 units and 180,000 units per month. That is considered the relevant range for production cost analysis. If the company expands significantly beyond 180,000 units per month, which of the following would be the most likely expectation? A. The fixed costs and the variable cost per unit will not change. B. Both the fixed costs and the variable cost per unit may change. C. The fixed costs may change, but the variable cost per unit will remain the same. D. The fixed costs will remain the same, but the variable cost per unit may change.

19. Which of the following would usually be considered a committed fixed cost for a retail sales corporation? A. The lease payments made on its store buildings B. The cost of the Caribbean trip given to the employee of the year C. The cost of running an annual leadership seminar for managers D. Both a and c above

20. Which of the following would usually be considered a discretionary fixed cost for a financial planning company? A. The cost of the annual employee picnic B. Property taxes on its corporate office building C. The cost of internships for selected college seniors D. Both a and c above