Question 1 / 1 point Variable costs as activity increases

Question 1 / 1 point Variable costs as activity increases will: Question options: increase per unit. increase in total. remain constant per unit. increase in total and remain constant per unit. Question 2 1 / 1 point A cost that increases in total but not proportionately with increases in the activity level is a(n): Question options: variable cost. variable cost with an unusual behavior pattern. fixed cost. mixed cost. Question 3 1 / 1 point The assumptions that underlie basic CVP analysis include all of the following except: Question options: when more than one product is sold total sales will be in a constant sales mix. the behavior of both costs and revenues is linear throughout the relevant range. All of three of the other choices are assumptions. all costs can be classified as variable or fixed with reasonable accuracy. Question 4 1 / 1 point Jameson Company desires net income of $1100000 when it has $2500000 of fixed costs and variable costs of 60% of sales. Required sales equals: Question options: $6250000. $2750000. $9000000. $6000000. Question 5 1 / 1 point A company’s break-even point can be decreased by decreasing: Question options: the selling price. the contribution margin. variable costs per unit. the contribution margin ratio. Question 6 0 / 1 point Sutton Company produced 98000 units in 46000 direct labor hours. Production for the period was estimated at 100000 units and 50000 direct labor hours. A flexible budget would compare budgeted costs and actual costs respectively at: Question options: 50000 hours and 46000 hours. 49000 hours and 46000 hours. 49000 hours and 50000 hours. 46000 hours and 46000 hours. Question 7 1 / 1 point A flexible budget: Question options: is in essence a series of static budgets at different levels of activity. can be prepared for each of the types of budgets included in a master budget. increases budget allowances both directly and proportionately for variable costs as production increases. All three of the other choices are correct. Question 8 1 / 1 point The initial budget prepared in the master budget is the: Question options: sales budget. budgeted balance sheet. production budget. budgeted income statement. Question 9 1 / 1 point Which of the following is true with regard to budgeting vs. long-range planning? Question options: The maximum length for both usually is a year with shorter periods of time also common. Both tend to be very detailed. They are the same in all significant aspects. Budgeting is oriented more toward short-term goals; long-range planning toward long-term goals. 0 1 / 1 point Which of the following is false with regard to budgetary planning? Question options: The starting point for the budgets of a not-for-profit organization is generally receipts rather than expenditures. A merchandising company uses a purchases budget instead of a production budget. Budgets may be used by manufacturing companies merchandising companies service enterprises and not-for-profit organizations. For a service enterprise the critical factor in budgeting is coordinating professional staff needs with anticipated services. 1 1 / 1 point Which of the following is true with regard to budgetary planning? Question options: The cash budget is often considered to be the most important output in preparing financial budgets. Generally accepted accounting principles require the budgets be prepared at least annually. The human behavior aspects of budgeting while they should not be ignored are generally of little real significance. The likelihood of a realistic budget is greater when the budget is developed from top management down to lower management. 2 1 / 1 point A static budget is: Question options: appropriate in evaluating a manager’s effectiveness in controlling fixed costs. applicable to cost budgets but not to a sales budget. appropriate in evaluating a manager’s effectiveness in controlling variable costs. modified or adjusted for changes in activity during the year. 3 1 / 1 point The potential benefit that may be obtained by following an alternative course of action is termed a(n): Question options: incremental cost. opportunity cost. sunk cost. avoidable cost. 4 1 / 1 point An order at a special price that is accepted will increase income if the revenue received exceeds the: Question options: fixed and variable costs associated with the order. variable manufacturing selling and administrative costs associated with the order. incremental costs associated with the order. variable manufacturing costs associated with the order. 5 1 / 1 point Media Unlimited makes custom office desks. It can sell semi-finished desks for $800. Costs incurred to this point total $500. It can finish the desks at an additional cost of $200 and increase the selling price to $1100. Media Unlimited should: Question options: finish the desks since it will increase profits $300 per desk. finish the desks since it will increase profits $100 per desk. sell the desks unfinished since finishing the desks will reduce profits. finish the desks since it will increase profits $600 per desk. 6 1 / 1 point Given the following costs for Harper Company classify each cost as variable fixed or mixed. Total cost at 4000 units 6000 units Cost A $12300 $16650 Cost B 17200 25800 Cost C 13000 13000 Question options: Cost A and Cost B are variable; Cost C is fixed. Cost A is mixed; Cost B is variable; Cost C is fixed. Cost A and Cost B are mixed; Cost C is fixed. Cost A is variable; Cost B is mixed; Cost C is fixed. 7 1 / 1 point Richmond Company manufactures a product that sells for $50 per unit. Richmond incurs a variable cost per unit of $35 and $2400000 in total fixed costs to produce this product. They are currently selling 200000 units. Contribution margin per unit is: 8 1 / 1 point Richmond Company manufactures a product that sells for $50 per unit. Richmond incurs a variable cost per unit of $35 and $2400000 in total fixed costs to produce this product. They are currently selling 200000 units. The breakeven point in dollars is: 9 1 / 1 point Richmond Company manufactures a product that sells for $50 per unit. Richmond incurs a variable cost per unit of $35 and $2400000 in total fixed costs to produce this product. They are currently selling 200000 units. The margin of safety in dollars is: Question 20 1 / 1 point Richmond Company manufactures a product that sells for $50 per unit. Richmond incurs a variable cost per unit of $35 and $2400000 in total fixed costs to produce this product. They are currently selling 200000 units. The number of units that must be sold in order to generate net income of $300000 is:

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