1. The three most common cost behavior classifications are: (Points: 5)
variable costs, product costs, and sunk costs.
fixed costs, variable costs, and mixed costs.
variable costs, period costs, and differential costs.
variable costs, sunk costs, and opportunity costs.
2. Which of the following costs is an example of a cost that remains the same in total as the number of units produced changes? (Points: 5)
Salary of a factory supervisor
Units of production depreciation
on factory equipment
3. Which of the following activity bases would be the most appropriate for food costs of a hospital? (Points: 5)
Number of cooks scheduled to work
Number of x-rays taken
Number of patients who stay in the hospital
Number of scheduled surgeries
4. Which of the following is not an example of a cost that varies in total as the number of units produced changes? (Points: 5)
Electricity per KWH to operate factory equipment.
Direct materials cost.
Straight-line depreciation on factory equipment.
Wages of assembly worker.
5. Ingram Co. manufactures office furniture. During the most productive month of the year, 3,500 desks were manufactured at a total cost of $84,400. In its slowest month, the company made 1,100 desks at a cost of $46,000. Using the high-low method of cost estimation, total fixed costs in August are: (Points: 5)
cannot be determined from the data given
6. If sales are $820,000, variable costs are 62% of sales, and operating income is $260,000, what is the contribution margin ratio? (Points: 5)
7. Variable costs as a percentage of sales for Leamon Inc. are 75%, current sales are $600,000, and fixed costs are $110,000. How much will operating income change if sales increase by $40,000? (Points: 5)
8. If fixed costs are $250,000, the unit selling price is $105, and the unit variable costs are $65, what is the break-even sales (units)?
9. Per unit, fixed costs will (Points: 5)
Increase when production increases
Decrease when production decreases
Decrease when production increases
Stay the same