The break-even point in units is 2,000 for Lumus Company. Contribution margin per unit was $20 per unit. If Lumus Company desires a net income of $45,000, sales in units would have to total

a.

2,000

b.

4,250

c.

2,250

d.

Some other figure not listed here

2

In January, 5,000 units were manufactured at a unit cost of $5. At this level of activity, variable costs are 40 percent of total unit costs. The following month, the company planned to manufacture 4,500 units. If cost behavior patterns remain unchanged in February,

a.

total fixed costs will decrease

b.

total variable cost will change

c.

total cost per unit will decrease

d.

variable cost per unit will decrease

e.

None of the above

3

Variances are calculated are similar in which of the following variance

a.

Labor rate variance and labor efficiency variance

b.

None of the other answers are correct

c.

Material price variance, material quantity variance, and total material variance

d.

Material price variance and labor rate variance

e.

Material price variance and labor efficiency variance