Question;Unit 3;? Question;1;3 out of 3 points;Redford, Inc. has provided the;following data;Sales Price;$200.00 per unit;Sales 6,000 Units;Fixed Cost;$300,000;Variable cost;$100.00 per unit;If the dollar contribution margin per unit is increased by;10%, total fixed cost is decreased by 20%, and all other factors remain the;same, net income will;A.;decrease by $60,000.;B.;increase by $60,000.;C.;increase by $120,000.;D.. increase by $420,000.;? Question;2;3 out of 3 points;Gardner Manufacturing Company produces a product that sells;for $120. A selling commission of 10% of the selling price is paid on each unit;sold. Variable manufacturing costs are $60 per unit. Fixed manufacturing costs;are $20 per unit based on the current level of activity, and fixed selling and;administrative costs are $16 per unit. The contribution margin per unit is;a.;$104;b.;$72;c.;$60;d.;$48;? Question;3;3 out of 3 points;Iacopi Corporation is a;wholesaler that sells a single product. Management has provided the following;cost data for two levels of monthly sales volume. The company sells the product;for $172.50 per unit.;Sales volume (units);4,000;5,000;Cost of sales;$307,600 $384,500;Selling and administrative costs $321,200;$337,000;The best estimate of the total contribution margin when;4,300 units are sold is;a.;$343,140;b.;$65,790;c.;$121,260;d.;$411,080;? Question;4;3 out of 3 points;Shipping expense is $9,000 for;8,000 pounds shipped and $11,250 for 11,000 pounds shipped. Assuming that this;activity is within the relevant range, if the company ships 9,000 pounds, its;expected shipping expense is closest to;a.;$10,125;b.;$8,583;c.;$9,972;d.;$9,750;? Question;5;3 out of 3 points;Fixed cost per unit increases as;activity decreases and decreases as activity increases.;True;False;? Question;6;3 out of 3 points;Within the relevant range, the;variable cost per unit;A.;remains constant as activity changes;B.;increases as activity increases.;C.;decreases as activity increases.;D.;can increase or decrease as the activity changes.;? Question;1;3 out of 3 points;Variable costing is also known;as;A.;Direct costing.;B.;Indirect costing.;C.;Marginal costing;D.;Both A and C;? Question;2;3 out of 3 points;Using absorption costing, a unit;of product includes what costs?;A.;Direct materials and direct labor.;B.;Direct materials, direct labor, and fixed overhead.;C.;Direct materials, direct labor, and variable overhead.;D.;Direct materials, direct labor, variable overhead, and fixed;overhead.;? Question;3;3 out of 3 points;Product cost under absorption;costing is characteristically;A.;Higher than under variable costing.;B.;Lower than under variable costing.;C.;Equal to variable costing.;D.;Higher sometimes and lower sometimes than variable costing.;? Question;4;3 out of 3 points;A segment of a business responsible for both revenues and;expenses would be referred to as;A.;Cost Center;B.;Investment Center;C.;Profit Center;D.;Residual Income;? Question;5;3 out of 3 points;Variable costing is attractive to;managers as an alternative to absorption costing because;A.;Absorption costing makes distinctions between fixed and;variable product costs.;B.;Absorption costing is well suited to CVP analysis;techniques.;C.;Absorption costing provides useful tools to managers for;planning and control.;D.;To generate data for CVP analysis, considerable time would;have to be invested to rework income statements constructed under absorption;costing.;? Question;6;3 out of 3 points;When production is equal to;sales, which of the following is true?;A.;No change occurs to inventories for either absorption;costing or variable costing methods.;B.;The use of absorption costing produces a higher net income;than the use of variable costing.;C.;The use of absorption costing produces a lower net income;than the use of variable costing.;D.;The use of absorption costing causes inventory value to;increase more than they would through the use of variable costing.
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