Question 1

Companies with large amounts of fixed costs will generally have a high operating leverage.

Accepted Answer

A) True 
 B)False

Question 2

Waterfall Company sells a product for $150 per unit. The variable cost is $80 per unit, and fixed costs are $270,000.?Determine the 
(a) break-even point in sales units and 
(b) break-even point in sales units if the company desires a target profit of $36,000. Round answer to the nearest whole number.

Accepted Answer

a. $150 - $80 = $70$...

Question 3

The point in operations at which revenues and expenses are exactly equal is called the break-even point.

Accepted Answer

A) True 
 B)False

Question 4

Given the following cost and activity observations for Smithson Company's utilities, use the high-low method to calculate Smithson's fixed costs per month. Do not round intermediate calculations.

Accepted Answer

A)   $1,533
B)   $2,530
C)   $22,800
D)   $50,600E) C) and D)
F) None of the above

Question 5

Assuming no other changes, operating income will be the same under both the variable and absorption costing methods when the number of units manufactured equals the number of units sold.

Accepted Answer

A) True 
 B)False

Exam 21: Cost-Volume-Profit Analysis

Assuming no other changes, operating income will be the same under both the variable and absorption costing methods when the number of units manufactured equals the number of units sold.

Correct Answer
verified

Companies with large amounts of fixed costs will generally have a high operating leverage.

Correct Answer
verified

Waterfall Company sells a product for $150 per unit. The variable cost is $80 per unit, and fixed costs are $270,000.?Determine the (a) break-even point in sales units and (b) break-even point in sales units if the company desires a target profit of $36,000. Round answer to the nearest whole number.

Correct Answer
verified
a. $150 - $80 = $70$...
View Answer

Given the following cost and activity observations for Smithson Company's utilities, use the high-low method to calculate Smithson's fixed costs per month. Do not round intermediate calculations.

Correct Answer
verified

The point in operations at which revenues and expenses are exactly equal is called the break-even point.

Correct Answer
verified

Exam 21: Cost-Volume-Profit Analysis

Assuming no other changes, operating income will be the same under both the variable and absorption costing methods when the number of units manufactured equals the number of units sold.

Correct AnswerverifiedShow Answer

Companies with large amounts of fixed costs will generally have a high operating leverage.

Correct AnswerverifiedShow Answer

Correct Answerverifieda. $150 - $80 = $70$...View AnswerShow Answer

Given the following cost and activity observations for Smithson Company's utilities, use the high-low method to calculate Smithson's fixed costs per month. Do not round intermediate calculations.

Correct AnswerverifiedShow Answer

The point in operations at which revenues and expenses are exactly equal is called the break-even point.

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
a. $150 - $80 = $70$...
View Answer

Correct Answer
verified

Correct Answer
verified