(Solution) If A Company Decreases Its Fixed Costs For Producing Its Only Product And All Other Things Remain Unchanged, Then Sales Revenue Per Unit At The... | Snapessays.com


(Solution) If a company decreases its fixed costs for producing its only product and all other things remain unchanged, then sales revenue per unit at the...


8 multiple choice questions thats from my accounting homework. Really would appreciate the help1. If a company decreases its fixed costs for producing its only product and all other things

 

remain unchanged, then sales revenue per unit at the breakeven point will

 

A.

 

increase.

 

B.

 

decrease.

 

C.

 

remain the same.

 

D.

 

More information is needed.

 

2. Worst Appliances provided the following information about its operations:

 

Variable Manufacturing Overhead

 

$10 per unit

 

Variable Selling and Administrative Costs

 

$16 per unit

 

Prime Costs

 

$8 per unit

 

Fixed Manufacturing Costs

 

$900,000

 

Fixed Selling and Administrative Costs

 

$600,000

 

What is the contribution margin ratio if the company sells its only product for $80 each?

 

A.

 

67.5%

 

B.

 

57.5%

 

C.

 

42.5%

 

D.

 

32.5%

 

3. ComCom Company has fixed costs that total $1,225,000 per month. The selling price for

 

its only product is $70, and the unit variable cost is $45. How much revenue must

 

ComCom generate to earn $840,000 in operating income next month?

 

A.

 

$8,260,000

 

B.

 

$5,782,000

 

C.

 

$2,352,000

 

D.

 

$2,065,000

 

4. On a CVP graph, the total cost line intersects the total revenue line at the

 

A.

 

breakeven point.

 

B.

 

origin.

 

C.

 

level of the fixed costs.

 

D.

 

level of the variable costs.

 

5. If a company increases unit variable costs for its only product and all other things remain

 

unchanged, then the breakeven quantity will

 

A.

 

increase.

 

B.

 

decrease.

 

C.

 

remain the same.

 

D.

 

More information is needed.

 


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This question was answered on: May 23, 2022

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