1.True or false; Mixed costs include both variable and fixed components

-True

-False

2.Your company delivers pizza. Currently you rent one car a month at a cost of $800 per month. With this one car you can deliver 200 pizzas a day - anything over that and you will have to rent another car. In this case, 0 to 200 pizzas per day is termed a

-fixed cost

-variable cost

-relevant range for 1 car delivering pizza

-none of the above

3.True or false..... Variable costs increase/decrease with production/sales levels

-True

-False

4.The equation to do CVP analysis is written as

-Revenue - Fixed Costs = Contribution Margin - Variable Cost = Operating Income/Profit

-Revenue - Contribution Margin = Fixed Costs - Variable Cost = Operating Income/Profit

-Revenue - Variable Costs = Contribution Margin - Fixed Costs = Operating Income/Profit

-None of the above

5.True or false..... The Breakeven Point is the sales level where an organization just covers its variable costs

-True

-False

6.If an organization makes and sells one more unit, the resulting net additional funds to the organization is termed

-fixed cost

-variable cost

-contribution margin

-depreciation

7.True or false....... The contribution margin ratio indicates how much of the unit selling price is left over after paying variable costs

-True

-False

8.Front line managers must understand cost behaviour in their departments as it will allow them to

1 point

-manage their departments more effectively

-provide accurate information to accountants doing CVP anlaysis

-all of the above

-none of the above

9.True or false..... The decision to "advertise or not" involves estimating if the contribution margin of additional sales will cover the additional advertising expense

-True

-False

10.True or false..... Fixed costs indicated in a monthly accounting report are always fixed regardless of the project being analyzed.

-True

-False