TF 1. If two companies have the same total sales and total expenses and make the same product, the volatility of net operating income with changes in sales will tend to be greater in the company with a higher proportion of fixed expenses in its cost struc If two companies have the same total sales and total expenses and make the same product, the volatility of net operating income with changes in sales will tend to be greater in the company with a higher proportion of fixed expenses in its cost structure. A) True B) False 2. If two companies produce the same product and have the same total sales and same total expenses, operating leverage will be lower in the company with a higher proportion of fixed expenses in its cost structure. If two companies produce the same product and have the same total sales and same total expenses, operating leverage will be lower in the company with a higher proportion of fixed expenses in its cost structure. A) True B) False MC 3. TB 89 Olis Corporation sells a product for $130 per unit. The product's current sales are 28,900 units and its break-even sales are 25,721 units. What is the margin of safety in dollars? TB 89 Olis Corporation sells a product for $130 per unit. The product's current sales are 28,900 units and its break-even sales are 25,721 units. What is the margin of safety in dollars? A) $413,270 B) $3,343,730 C) $2,504,667 D) $3,757,000 4. TB 72 Lone International Corporation's only product sells for $230.00 per unit and its variable expense is $80.50. The company's monthly fixed expense is $822,250 per month. The unit sales to attain the company's monthly target profit of $33,000 is closes TB 72 Lone International Corporation's only product sells for $230.00 per unit and its variable expense is $80.50. The company's monthly fixed expense is $822,250 per month. The unit sales to attain the company's monthly target profit of $33,000 is closest to: A) 3,718 units B) 6,688 units C) 10,624 units D) 5,721 units 5. TB 53 Balonek Inc.'s contribution margin ratio is 57% and its fixed monthly expenses are $41,000. Assuming that the fixed monthly expenses do not change, what is the best estimate of the company's net operating income in a month when sales are $112,000? TB 53 Balonek Inc.'s contribution margin ratio is 57% and its fixed monthly expenses are $41,000. Assuming that the fixed monthly expenses do not change, what is the best estimate of the company's net operating income in a month when sales are $112,000? A) $63,840 B) $7,160 C) $71,000 D) $22,840 6. TB 78 Smith Company sells a single product at a selling price of $30 per unit. Variable expenses are $12 per unit and fixed expenses are $41,400. Smith's break-even point is: TB 78 Smith Company sells a single product at a selling price of $30 per unit. Variable expenses are $12 per unit and fixed expenses are $41,400. Smith's break-even point is: A) 1,380 units B) 2,300 units C) 3,450 units D) 6,900 units 7. TB107 A cement manufacturer has supplied the following data: What is the company's unit contribution margin? TB 107 A cement manufacturer has supplied the following data: Picture What is the company's unit contribution margin? A) $2.00 B) $0.32 C) $4.30 D) $2.30 8. TB134 Evergreen Corp. has provided the following data: The contribution margin ratio is: TB 134 Evergreen Corp. has provided the following data: Picture The contribution margin ratio is: A) 70% B) 45% C) 75% D) 55% 9. TB179 Scheidel Enterprises, Inc. produces and sells a single product whose selling price is $190.00 per unit and whose variable expense is $81.70 per unit. The company's monthly fixed expense is $682,290. Assume the company's monthly target profit is $21, TB 179 Scheidel Enterprises, Inc. produces and sells a single product whose selling price is $190.00 per unit and whose variable expense is $81.70 per unit. The company's monthly fixed expense is $682,290. Assume the company's monthly target profit is $21,000. The unit sales to attain that target profit are closest to: A) 8,608 units B) 6,494 units C) 6,268 units D) 3,702 units 10. TB 83 Data concerning Odum Corporation's single product appear below: The break-even in monthly unit sales is closest to: TB 83 Data concerning Odum Corporation's single product appear below: Picture The break-even in monthly unit sales is closest to: A) 1,413 units B) 1,110 units C) 622 units D) 1,048 units