Question 1 if the activity level increases 10%, total variable

Question 1  

If the activity level increases 10%, total variable costs will


remain the same. 

decrease by less than 10%. 

increase 10%. 

increase by more than 10%.


Question 2  

Portman Company’s activity for the first three months of 2013 are as follows:


Machine HoursElectrical Cost





Using the high-low method, how much is the cost per machine hour?







Question 3  

Gribble Company’s high and low level of activity last year was 60,000 units of product produced in May and 20,000 units produced in November. Machine maintenance costs were $104,000 in May and $40,000 in November. Using the high-low method, determine an estimate of total maintenance cost for a month in which production is expected to be 45,000 units.







Question 4  

The break-even point is where


total sales equal total fixed costs. 

total variable costs equal total fixed costs. 

contribution margin equals total fixed costs. 

total sales equal total variable costs.


Question 5  

Armstrong Industries has a contribution margin of $300,000 and a contribution margin ratio of 30%. How much are total variable costs?







Question 6  

Farmers’ Industries has fixed costs of $400,000 and variable costs are 60% of sales. How much will Farmers report as sales when its net income equals $40,000?







Question 7  

A cost which remains constant per unit at various levels of activity is a


variable cost. 

fixed cost.

manufacturing cost. 

mixed cost.


Question 8  

Wendy Industries produces only one product. Monthly fixed expenses are $12,000, monthly unit sales are 2,500, and the unit contribution margin is $10. How much is monthly net income?







Question 9  

The increased use of automation and less use of the work force in companies has caused a trend towards an increase in


both variable and fixed costs. 

variable costs and no change in fixed costs. 

fixed costs and a decrease in variable costs. 

variable costs and a decrease in fixed costs.


Question 10  

For an activity base to be useful in cost behavior analysis,


the activity level should be constant over a period of time. 

the activity should always be stated in dollars. 

there should be a correlation between changes in the level of activity and changes in costs. 

the activity should always be stated in terms of units


Question 11  

Which one of the following is not an assumption of CVP analysis?


All units produced are sold. 

The behavior of costs and revenues are linear within the relevant range. 

Sales mix remains constant. 

All costs are variable costs.


Question 12  

How much sales are required to earn a target income of $160,000 if total fixed costs are $200,000 and the contribution margin ratio is 40%?







Question 13  

Greg’s Golf Carts produces two models: Model 24 has sales of 500 units with a contribution margin of $40 each; Model 26 has sales of 350 units with a contribution margin of $50 each. If sales of Model 26 increase by 100 units, how much will profit change?


$17,500 increase 

$22,500 increase 

$5,000 increase 

$35,000 increase


Question 14  

At the high level of activity in November, 7,000 machine hours were run and power costs were $16,000. In April, a month of low activity, 2,000 machine hours were run and power costs amounted to $8,000. Using the high-low method, the estimated fixed cost element of power costs is







Question 15  

The CVP income statement


is distributed internally and externally. 

discloses contribution margin in the body of the statement. 

classifies costs by functions. 

will reflect a different net income than the traditional income statement


Place your order
(550 words)

Approximate price: $22

Calculate the price of your order

550 words
We'll send you the first draft for approval by September 11, 2018 at 10:52 AM
Total price:
The price is based on these factors:
Academic level
Number of pages
Basic features
  • Free title page and bibliography
  • Unlimited revisions
  • Plagiarism-free guarantee
  • Money-back guarantee
  • 24/7 support
On-demand options
  • Writer’s samples
  • Part-by-part delivery
  • Overnight delivery
  • Copies of used sources
  • Expert Proofreading
Paper format
  • 275 words per page
  • 12 pt Arial/Times New Roman
  • Double line spacing
  • Any citation style (APA, MLA, Chicago/Turabian, Harvard)

Our guarantees

Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.

Money-back guarantee

You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.

Read more

Zero-plagiarism guarantee

Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.

Read more

Free-revision policy

Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.

Read more

Privacy policy

Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.

Read more

Fair-cooperation guarantee

By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.

Read more

Enjoy 10% OFF today with the coupon code: save10