ACC 350 WK four Quiz three Chapter three
1) To carry out cost-volume-profit evaluation, an organization should be capable of separate prices into mounted and variable elements. Reply:
2) Price-volume-profit evaluation could also be used for multi-product evaluation when the proportion of various merchandise stays fixed. Reply:
three) It’s assumed in CVP evaluation that the unit promoting value, unit variable prices, and unit mounted prices are recognized and fixed. Reply:
four) In CVP evaluation, the variety of output models is the one income driver. Reply:
5) Many corporations discover even the only CVP evaluation helps with strategic and long-range planning. Reply:
6) In CVP evaluation, complete prices may be separated right into a
mounted part that doesn’t range with output and a part that’s
variable with output stage. Reply: 7) In CVP evaluation, variable prices embrace direct variable prices, however don’t embrace oblique variable prices. Reply:
eight) In CVP evaluation, an assumption is made that the entire
revenues are linear with respect to output models, however that complete prices
are non-linear with respect to output models. Reply:
9) A income driver is outlined as a variable that causes modifications in costs. Reply:
10) If the promoting value per unit is $20 and the contribution margin proportion is 30%, then the variable value per unit should be $6. Reply:
11) Whole revenues much less complete mounted prices equal the contribution margin. Reply:
12) Gross margin is reported on the contribution earnings assertion. Reply: 13) If
the promoting value per unit of a product is $30, variable prices per unit
are $20, and complete mounted prices are $10,000 and an organization sells 5,000
models, working earnings could be $40,000. Reply:
14) The promoting value per unit is $30, variable value per
unit $20, and stuck value per unit is $three. When this firm operates
above the breakeven level, the sale of yet another unit will improve internet
earnings by $7. Reply:
15) An organization with gross sales of $100,000, variable prices of
$70,000, and stuck prices of $50,000 will attain its breakeven level if
gross sales are elevated by $20,000. Reply:
16) Breakeven level shouldn’t be a very good planning software for the reason that purpose of enterprise is to make a revenue. Reply:
17) Breakeven level is that amount of output the place complete revenues equal complete prices. Reply: 18) In
the graph technique of CVP evaluation, the breakeven level is the (X-axis)
amount of models offered for which the entire revenues line crosses the
complete prices line. Reply:
19) Within the graph technique of CVP evaluation, the entire
income line may be calculated by figuring out the entire income at solely
one actual output stage as a result of the place to begin of the road is all the time
the intersection of the X and Y axes. Reply: 20) A profit-volume graph exhibits the impression on working earnings from modifications within the output stage. Reply:
21) If the promoting value per unit of a product is $50,
variable prices per unit are $40, and complete mounted prices are $50,000, a
firm should promote 6,000 models to make a goal working earnings of
$10,000. Reply:
22) A rise within the tax charge will improve the breakeven level. Reply:
23) When making internet earnings evaluations, CVP calculations
for goal earnings should be acknowledged by way of goal working earnings
as a substitute of goal internet earnings. Reply:
24) If working earnings is $70,000 and the earnings tax charge is 30%, then internet earnings shall be $49,000. Reply:
25) If deliberate internet earnings is $21,000 and the tax charge is 30%, then deliberate working earnings could be $27,300. Reply:
26) Sensitivity evaluation is a “what-if” method that
managers use to look at how a end result will change if the initially
predicted information usually are not achieved or if an underlying assumption modifications. Reply: 27) Margin of security measures the distinction between budgeted revenues and breakeven revenues. Reply:
28) If an organization’s breakeven income is $100 and its budgeted income is $125, then its margin of security proportion is 25%. Reply:
29) Sensitivity evaluation helps to guage the danger related to selections. Reply:
30) If contribution margin decreases by $1 per unit, then working income will improve by $1 per unit. Reply:
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