HELP ME PLEASE GUYS!

1.Fran Company is currently operating profitably. The company has a fixed cost structure. Based on this information which of the following statements is true?

If volume increases by 20%, profitability will increase by less than 20%.

If volume increases by 20%, profitability will increase by more than 20%.

If volume increases by 20%, profitability will increase by 20%. If volume increases by 20%, profitability will decrease by 20%.

2.The contribution margin is determined by subtracting

fixed product cost from sales.

variable product and variable period cost from sales.

variable product and fixed period cost from sales.

variable product and fixed product costs from sales.

3.

Operating leverage is caused by.

product cost.

fixed cost.

variable cost.

period cost.

4.

Many companies determine the price they charge for their products by adding an amount of desired profit to the cost of making or buying the product. Frequently, it is inappropriate to use the actual cost of the product when implementing such a cost-plus pricing model. This statement is

true.

false.

5.

Handy Hiking produces backpacks. In the previous year, its highest and lowest production levels occurred in July and January, respectively. In July, it produced 4,000 backpacks at a total cost of $110,000. In January, it produced 2,500 backpacks at a total cost of $87,500. Using the high/low method, the average variable cost per of producing a backpack was:

$31.25

$30.38

$15.00

$27.50

6.Nasenko Companys cost and production data for two recent months included the following:

	March			April
Production (units)		700			1,000
Rent	$	2,200		$	2,200
Utilities	$	500		$	714

Required:

a.Required:

a.	Calculate the rental cost per unit and the utilities cost per unit for both March and April. (Round your answers to 2 decimal places.)

b.	Identify which cost is variable and which is fixed.