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COST-VOLUME-PROFIT ANALYSIS mcq homework and questions




Question;154. The;income statement classifies cost as variable or fixed and computes a;contribution margin.;155. _________________ tells a company how far;sales can drop before it will be operating at a loss.;156. ___________________ is the relative;percentage in which a company sells its multiple products.;157. When more than one product is sold, the;break-even point can be determined by dividing fixed expenses by _______________________.;158. When a company has;management must decide which products to make and sell in order to maximize net;income.;159. ___________________ refers to the relative;proportion of fixed versus variable costs that a company incurs.;160. The _________________________ provides a;measure of a company?s earnings volatility and can be used to compare companies.;a161. Under _____________________ all;manufacturing costs are charged to, or absorbed by, the product.;a162. Fixed manufacturing costs are treated as;period costs under ______________________.;a163. When production exceeds sales, a portion of;the _____________________ is deferred to a future period as part of the cost of;ending inventory under absorption costing, but not under variable costing.;a164. When units produced exceed units sold;income under absorption costing is ___________ than income under variable;costing.;a 165. Management may be tempted to overproduce in a given period in;order to increase net income if _______________ is used for internal decision;making.;SHORT-ANSWER;ESSAY QUESTIONS;S-A E 166;A CVP income statement is frequently prepared for;internal use by management. Describe the features of the CVP income statement;that make it more useful for management decision-making than the traditional;income statement that is prepared for external users.;S-A E 167;Nancy Sound, president of Crosley Corp., has;heard about operating leverage and asks you to explain this term. What is;operating leverage? How does a company increase its operating leverage?;aS-A E 168;Define variable costing and absorption costing.;What are some of the benefits to a manager from using variable costing instead;of absorption costing for internal decision making?;aS-A E 169;How do differences in production and sales levels;affect income under absorption and variable costing?


Paper#41745 | Written in 18-Jul-2015

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