39. The contribution margin format income statement:
40. Which of the following terms do not appear on the contribution margin format income
statement:
41. The contribution margin format income statement is organized by:
42. A 10% change in a firm’s revenues is likely to result in a change of more than 10% in the
firm’s operating income because:
43. A firm has revenues of $120,000, a contribution margin ratio of 30%, and fixed expenses
that total $56,000. If revenues increase $20,000, then:
44. A management decision that would have a long term influence on the operating leverage
of a firm would be:
45.
Operating income at a volume of 4,000 units per month is:
46.
The break-even point volume of units is:
47.
The break-even point in terms of total revenues per month is:
48.
The contribution margin ratio is:
49.
If sales volume were to decrease 10%, from 4,000 units per month to 3,600 units per month,
operating income would:
50.
If the selling price per unit were to drop $2, from $100 to $98, the sales volume were to increase
500 units to 4,500 units per month, and advertising expense were to increase by $1,000:
51. The contribution margin ratio always decreases when the:
52. If fixed costs were increased by $9,000 and the contribution margin ratio remained at 30
percent, then sales must increase by _________ in order to cover the additional fixed expenses.
53. ABU Co. has several products, each with a different contribution margin ratio. If the same
number of units were sold in July as in June, but the sales mix changed:
54. A firm’s products have an average contribution margin ratio of 40%, which will be
maintained for the next month even though fixed expenses are expected to rise by $20,000. In
order to keep operating income for the month from being affected, revenues will have to increase
by:
55. Each of a company’s two product lines has a different contribution margin ratio. If the
company’s total sales remain the same but the sales mix shifts toward selling more of the
product with the higher contribution ratio, which of the following is true?
56. Each of a company’s several product lines has a different contribution margin ratio. Total
sales in 2014 were 20% higher than total sales in 2013. Total contribution margin for 2014 will
be:
57. For each of the following costs, identify the cost behavior as variable, mixed, or fixed:
58. XYZ Company incurred the following costs for the month of August when it observed an
activity level of 10,000 units.
During October, the activity level was 16,000 units, and the total costs incurred were $150,000.
a. Calculate the variable costs, fixed costs, and mixed costs incurred during October.
b. Use the high-low method to calculate the cost formula for mixed costs.
c. If the activity level were expected to be 13,800 units for the month of December, what amount
of total costs would be expected?