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2-21 Nature of Variable and Fixed Costs As I understand it, costs such as the salary of the vice president of transportation oper ations
2-21 Nature of Variable and Fixed Costs "As I understand it, costs such as the salary of the vice president of transportation oper ations are variable because the more traffic you handle, the less your unit cost. In con trast, costs such as fuel are fixed because each ton-mile should entail consumption of the same amount of fuel and hence bear the same unit cost." Do you agree? Explain 2-22 Basic Review Exercises Fill in the blanks for each of the following independent cases (ignore income taxes): Variable Sales Expenses Contribution Margin Fixed Expenses Net Income 1. $900,000 $500,000 $ - $350,000 2. 800,000 I 350,000 $ - 80,000 3. 600,000 340,000 250,000 2-23 Basic Review Exercises Fill in the blanks for each of the following independent cases: (a) (b) (c) (d) (e) (f) Selling Variable Total Total Total Price Cost per Units Contribution Fixed Net Case per Unit Unit Sold Margin Costs Income 1. $25 $- 120,000 $720,000 $640,000 S
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