1.What is the underlying assumption for cost-volume-profit analysis?

A.Revenues and costs behave in a linear manner

B.Costs can be categorized as variable, fixed, or semi-variable

C.Worker efficiency and productivity remain constant

D.All of these are assumptions that underlie cost-volume-profit analysis

2.The contribution margin per unit increases due to:

A.increase in selling price

B.decrease in selling price

C.increase in variable costs

D.decrease in fixed costs

3.Peter Furniturehas fixed costs of RM10, 000 and contribution margin per unit of RM24. Which of the following statement is (are)TRUE?

A.Each unit contributes RM24toward covering the fixed costs of RM10, 000

B.The situation described is not possible and there must be an error

C.Once the break-even point is reached, the company will make money at the rate of RM24

perunit

D.Statements A and C are true

4.At avolume level of 500,000 units,LaiciTin Coreported the following information:

Sales priceRM60

Variable cost per unitRM20

Fixed cost per unitRM4

The company's contribution-margin ratio is:

A.0.33

B.0.40

C.0.60

D.0.67

5.ZredicCo'spresents the following figures for the first quarterbudget:

Sales revenueRM840, 000

Contribution marginRM504, 000

Net incomeRM54, 000

If the company's break-even sales total RM750,000,ZredicCo'ssafety margin would be:

A.(RM90,000)

B.RM90,000

C.RM246,000

D.RM336,000

6.A company that desires to lower its break-even point should strive to:

A.sell more units

B.increase fixed costs

C.decrease selling prices

D.reduce variable costs

7.If a company desires to increase its safety margin, it should:

A.increase fixed costs

B.stimulate sales volume

C.decrease selling prices

D.decrease the contribution margin

8.IfZarraSdnBhd'sfixed costs are RM285, 000, the sales price per unit is RM80 per unit, and the variable cost per unit is RM20, calculate the break-even point (in RM).

A.RM380,000

B.RM95,000

C.RM14,250

D.RM4,750

9.KucaiBhdhas fixed costs of RM200, 000and variable costs are 30% of sales.If the company desires net income of RM10, 000, what would be the required sales?

A.RM700,000

B.RM525,000

C.RM350,000

D.RM300,000

10.CVP analysisDOES NOTconsider:

A.level of activity

B.variable cost per unit

C.fixed cost per unit

D.sales mix

11.Which of the following is an example of a cost that varies in total as the number of unitsproduced changes?

A.Salary of a production supervisor

B.Direct materials cost

C.Property taxes on factory buildings

D.Straight-line depreciation on factory equipment

12.Contribution margin is:

A.the excess of sales revenue over variable cost

B.another term for volume in the "cost-volume-profit" analysis

C.profit

D.the same as sales revenue

13.Salim'sfixed costs are RM41, 500, the variable cost is RM12 per unit. If Salim sellsthe product for RM22 per unit, the breakeven point is:

A.4,150 units

B.8,300 units

C.2,075 units

D.6,225 units

14.Thefixed costsofJuaraCo.are RM500, 000and the unit contribution margin is RM40.Ifthe fixed costs are increased by RM80,000, what is the break-even point?

A.14,500

B.12,500

C.8,333

D.9,667

15.The followings areunderlying assumptionsof CVP analysisEXCEPT:

A.the changes in the activity are the only factors that affect costs

B.the costs classifications are reasonably accurate

C.the beginning inventory is larger than ending inventory

D.sales mix is constant

16.FattChooSdnBhd'ssales are RM820, 000, variable costs are 62% of sales, and operating income is RM260, 000, what is the contribution margin ratio?

A.53.1%

B.38%

C.62%

D.32%

17.If fixed costs are RM500, 000 and the unit contribution margin is RM12, what amount of units must be sold in order to realize an operating income of RM100, 000?

A.5,000

B.41,667

C.50,000

D.58,333

18.If sales, variable costs and operating income are RM400, 000, RM200, 000 andRM100,000respectively, what is the contribution margin ratio?

A.75%

B.50%

C.25%

D.0%

19.TitianBhdhad a contribution margin of RM300, 000 and a contribution margin ratio of 20%, what is the total variable cost?

A.RM1,500,000

B.RM1,200,000

C.RM240,000

D.RM60,000

20.ZazaWestSdnBhdreported the following data in its Statement of Profit or Loss and Other Comprehensive Income:

Unit sold8,000

Sales revenueRM9,600,000

Variable costsRM6,000,000

Fixed costRM2,600,000

If the company desired to earn a target net profit of RM1,270,000, it would have to sell:

A.5,778 units

B.8,600 units

C.10,160 units

D.11,908 units