QUESTION 1 The Contribution Margin can be expressed as sales less cost of goods sold. sales less variable cost of goods sold and variable period expenses. sales less variable production costs. sales less variable and fixed costs. gross profit. 2 points QUESTION 2 The total Contribution Margin decreases if sales volume remains the same and fixed expenses increase. variable cost or expense per unit increases. fixed expenses decrease. variable cost or expense per unit decreases. None of the above. 2 points QUESTION 3 If a company increases its product’s selling price by $2.00 because labor costs increased by $2.00, the breakeven point in units will remain unchanged increase. decrease. be unknown unless the volume sold is known. 2 points QUESTION 4 A company has fixed costs of $900. Unit variable costs are $50 and the product sells for $80. What is the Contribution Margin Ratio? 14.4% 20% 30% 37.5% 62.5% 2 points QUESTION 5 A company has fixed costs of $6720. Sales price is $76 per unit variable costs are $48. What is the breakeven point in dollars? $240.00 $2475.79 $4244.21 $18,240.00 $188,160.00 2 points QUESTION 6 Sales $360 Var Costs 240 CM $120 Fixed Costs 85 NOI $ 35 If sales volume increased 10% due to infrastructure upgrades that increased fixed costs by 5%, what would the effect be on Net Operating Income? Increase of 5% Decrease of 5% Increase of $5.00 Increase of $7.75 Increase of $31.75 2 points QUESTION 7 Sales (36 items sold at $10 each) $360 Var Costs 280 CM $ 80 Fixed Costs 95 NOL $ 15 If the target Net Operating Income is $10, how many additional units must be sold? 11.25 units, assuming partial units may be sold 12.25 units, assuming partial units may be sold 22.875 units, assuming partial units may be sold 47.25 units, assuming partial units may be sold 52.75 units, assuming partial units may be sold 2 points QUESTION 8 Sales $160 Var Costs 100 CM $ 60 Fixed Costs 70 NOL $ 10 What are the additional sales dollars needed to break even? $6.67 $12.67 $16.67 $26.67 $43.33 2 points QUESTION 9 A company produces and sells two products. Product 1 Product 2 Sales $170 $190 Variable Expenses 70 90 Fixed expenses are $1,500. If the sales mix were to shift toward Product 1 with overall sales remaining constant, the overall breakeven point for the company would remain the same. increase. decrease. either increase or decrease. 2 points QUESTION 10 A company has Segment A and Segment B. Sales for A = $100 Sales for B = $120 Variable Expenses for A = $80 Variable Expenses for B = $90 Fixed Expenses for the entire company are $50, of which $5 can be traced to A and $7 can be traced to B. What is teh Segment Margin in dollars and % terms for both A and B? Segment A = $20, 20%; Segment B = $30, 25% Segment A = $5, 5%; Segment B = $7, 5.8% Segment A = $15, 15%; Segment B = $23, 19.2% Segment A = $15, 15%; Segment B = $19, 19% cannot be determined. 2 points QUESTION 11 A cost that would be considered a product cost under both variable and absorption costing would be: depreciation expense on the office building. sales commissions. variable selling expenses. fixed manufacturing overhead. variable manufacturing overhead costs. 2 points QUESTION 12 Net income reported under absorption costing will exceed net income under variable costing for a given period if: production and sales are equal for that period. production exceeds sales for that period. sales exceed production for that period. variable manufacturing costs exceed fixed manufacturing overhead costs. lean production and just-in-time inventory is used. 2 points QUESTION 13 ABC Co. manufactures and sells a single product and has provided the following information: Unit Product Costs: Direct Material…………..$31 Direct Labor………………..26 Variable Mfg OH…………10 Variable Selling and Admin Expenses…………$7/unit Fixed Selling and Admin Expenses……………..$5,200 Fixed Manufacturing Overhead……………………$31,500 Unit Sales Price……………