Which of the following is true of line management?

A.

It is directly responsible for achieving the goals of the organization.

B.

It provides advice, support, and assistance to staff management.

C.

It is responsible of management accounting functions.

D.

It only includes the top level management.

Cost accumulation and cost assignment are synonymous.

True

False

Which of the following is an assumption of CVP analysis?

A.The unitselling price is variable as it is subject to demand and supply.

B.When graphed, total costs curve upward.

C.Total costs can be divided into inventoriable and period costs with respect to the level of output.

D.Total costs can be divided into a fixed component and a component that is variable with respect to the level of output.

The East Company manufactures several different products. Unit costs associated with Product ORD105 are as follows:

Direct materials	$54
Direct manufacturing labor	8
Variable manufacturing overhead	11
Fixed manufacturing overhead	25
Sales commissions (2% of sales)	5
Administrative salaries	12
Total	$115

What is the percentage of the total fixed costs per unit associated with Product ORD105 with respect to total cost?

A.26%

B.32%

C.37%

D.15%

If a company is planning to reduce the selling price per unit but not reduce expectations of revenues, they must believe that ________.

A.increased collections will increase income

B.variable costs will decline as well

C.more units will be sold

D.the fixed costs will cover the lower sales price