q7 If a companys total fixed cost increases by $40,000, which of the following will be true?

A.

The break-even point will increase.

B.

The contribution margin ratio will decrease.

C.

The break-even point will be unchanged.

D.

The contribution margin ratio will increase.

q8

Which of the following statements regarding activity-based costing (ABC) is true?

A.

ABC is an appropriate tool for analysing non-manufacturing costs.

B.

ABC is only used in manufacturing organisations.

C.

ABC can improve product cost accuracy where overhead costs are a small proportion of total costs

D.

ABC cannot be used to analyse the profitability of customers.