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The dollars available from each unit of sales to cover fixed cost and profit is the unit variable cost. True False For purposes of analysis,

The dollars available from each unit of sales to cover fixed cost and profit is the unit variable cost.

True

False

For purposes of analysis, mixed costs are

a.classified as fixed costs

b.separated into their variable and fixed cost components

c.classified as variable costs

d.classified as period costs

Variable costs are costs that remain constant in total dollar amount as the level of activity changes.

True

False

If fixed costs are $400,000 and the unit contribution margin is $20, what amount of units must be sold in order to have a zero profit?

a.10,000 units

b.25,000 units

c.400,000 units

d.20,000 units

Payton Industries has fixed costs of $490,000, the unit selling price is $35, and the unit variable costs are $20. What is the break-even sales (units) if fixed costs are reduced by $40,000?

a.14,000 units

b.30,000 units

c.24,500 units

d.32,667 units

Costs that remain constant in total dollar amount as the level of activity changes are called

a.product costs

b.fixed costs

c.variable costs

d.mixed costs

If fixed costs are $500,000, the unit selling price is $55, and the unit variable costs are $30, what is the break-even sales (units) if fixed costs are increased by $80,000?

a.10,545 units

b.19,333 units

c.25,000 units

d.23,200 units

If yearly insurance premiums are increased, this change in fixed costs will result in an increase in the break-even point.

True

False

Carmelita Inc., has the following information available:

Costs from Beginning Inventory Costs from current Period

Direct materials 2,000 $22,252

Conversion costs. 6,200 150,536

At the beginning of the period, there were 500 units in process that were 60% complete as to conversion costs and 100% complete as to direct materials costs. During the period, 4,500 units were started and completed. Ending inventory contained 340 units that were 30% complete as to conversion costs and 100% complete as to materials costs. Assume that the company uses the FIFO process cost method. Round cost per unit figures to two cents, i.e., $2.22, when calculating total costs.

The total costs that will be transferred into Finished Goods for units started and completed were

a.$162,855

b.$161,775

c.$161,505

d.$156,960

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