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# 1. A production supervisors salary that does not vary with

### Resolved Question:

1.
A production supervisor's salary that does not vary with the number of units produced is an example of a fixed cost.
(Points: 5)
True
False

2.
Total fixed costs change as the level of activity changes.
(Points: 5)
True
False

3.
Variable costs are costs that remain constant on a per-unit basis as the level of activity changes.
(Points: 5)
True
False

4.
Direct materials and direct labor costs are examples of variable costs of production.
(Points: 5)
True
False

5.
For purposes of analysis, mixed costs can generally be separated into their variable and fixed components.
(Points: 5)
True
False

6.
If fixed costs are \$850,000 and the unit contribution margin is \$50, profit is zero when 15,000 units are sold.
(Points: 5)
True
False

7.
If direct materials cost per unit increases, the break-even point will increase.
(Points: 5)
True
False

8.
If a business sells two products, it is not possible to estimate the break-even point.
(Points: 5)
True
False

9.
Cost behavior refers to the manner in which:
(Points: 5)
a cost changes as the related activity changes
a cost is allocated to products
a cost is used in setting selling prices
a cost is estimated

10.
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
Wages of assembly worker

11.
A cost that has characteristics of both a variable cost and a fixed cost is called a:
(Points: 5)
variable/fixed cost
mixed cost
discretionary cost
sunk cost

12.
Given the following cost and activity observations for Wondrous Company’s utilities, use the high-low method to calculate Wondrous’ variable utilities costs per machine hour.

Cost

Machine Hours
March
\$3,100

15,000

April
2,700

10,000

May
2,900

12,000

June
3,500

18,000

(Points: 5)
\$10.00
\$.67
\$.63
\$.10

13.
As production increases, what would you expect to happen to fixed cost per unit?
(Points: 5)
Increase
Decrease
Remain the same
Either increase or decrease, depending on the variable costs

14.
Contribution margin is:
(Points: 5)
the excess of sales revenue over variable cost
another term for volume in the "cost-volume-profit" analysis
profit
the same as sales revenue

15.
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)
53.1%
38%
62%
32%

16.
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)
\$10,000 increase
\$10,000 decrease
\$30,000 decrease
\$30,000 increase

17.
If sales are \$820,000, variable costs are \$524,800, and operating income is \$260,000, what is the contribution margin ratio?
(Points: 5)
53.1%
33%
64%
36%

18.
If fixed costs are \$39,600, the unit selling price is \$42, and the variable costs are \$24, what is the break-even sales (units)?
(Points: 5)
2,500
943
1,650
2,200

19.
Shipley Co. sells two products, Orks and Zins. Last year Shipley sold 14,000 units of Orks and 21,000 units of Zins. Related data are:

Product
Unit Selling
Price

Unit Variable
Cost

Unit Contribution
Margin
Orks
\$120

\$80

\$40
Zins
80

60

20

What was Shipley’s Co.’s overall unit contribution margin?
(Points: 5)
\$20
\$40
\$28
\$24

20.
If sales are \$400,000, variable costs are 75% of sales, and operating income is \$50,000, what is the operating leverage?
(Points: 5)
2.500
7.500
2.000
0
Submitted: 7 years ago.
Category: Homework
Expert:  Manal Elkhoshkhany replied 7 years ago.

Hello nacho

Regards,

Customer: replied 7 years ago.
3pm pacific time
Customer: replied 7 years ago.
so are u going to work on it
Expert:  Manal Elkhoshkhany replied 7 years ago.
yes I am working on it now
Expert:  Manal Elkhoshkhany replied 7 years ago.

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Manal Elkhoshkhany, Tutor
Category: Homework
Satisfied Customers: 9732
Experience: More than 5000 online tutoring sessions.

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