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##### Accounting Multiple Choice Questions

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1) The contribution-margin ratio is;the difference between the selling price and the variable cost per unit.?;fixed cost per unit divided by variable cost per unit.?;variable cost per unit divided by the selling price.?;unit contribution margin divided by the selling price.?;unit contribution margin divided by fixed cost per unit.?;2) A company observed a decrease in the cost per unit. All other things being equal, which of the following is probably true?;The company is studying a variable cost, and total volume has increased.?;The company is studying a variable cost, and total volume has decreased.?;The company is studying a fixed cost, and total volume has increased.?;The company is studying a fixed cost, and total volume has decreased.?;The company is studying a fixed cost, and total volume has remained constant.?;3) A company has fixed costs of \$900 and a per-unit contribution margin of \$3. Which of the following statement is (are) true?;Total contribution margin equals the sum of variable cost plus fixed cost.?;The situation described is not possible and there must be an error.?;Once the break-even point is reached, the company will increase income at the rate of \$3 per unit.?;The firm will definitely lose money in this situation.?;4) Ribco Co. makes and sells only one product. The unit contribution margin is \$6 and the break-even point in unit sales is 24,000. The company's fixed costs are;\$4,000.?;\$14,400.?;\$40,000.?;\$144,000.?;an amount other than those above.?;5) Which of the following methods of cost estimation relies on only two data points?;Least-squares regression.?;The high-low method.?;The visual-fit method.?;Account analysis.?;Multiple regression.?;6) A manager who wants to determine the percentage impact on income of a given percentage change in sales would multiply the percentage increase/decrease in sales revenue by the;contribution margin.?;gross margin.?;operating leverage factor.?;safety margin.?;contribution-margin ratio.?;7) Brooklyn sells a single product to wholesalers. The company's budget for the upcoming year revealed anticipated unit sales of 31,600, a selling price of \$20, variable cost per unit of \$8, and total fixed costs of \$360,000. If Brooklyn's unit sales are 200 units less than anticipated, its breakeven point will;increase by \$12 per unit sold.?;decrease by \$12 per unit sold.?;increase by \$8 per unit sold.?;decrease by \$8 per unit sold.?;not change.;8) Swanson and Associates presently leases a copy machine under an agreement that calls for a fixed fee each month and a charge for each copy made. Swanson made 7,000 copies and paid a total of \$360 in March, in May, the firm paid \$280 for 5,000 copies. The company uses the high-low method to analyze costs.?Swanson's variable cost per copy is;\$0.040.??;\$0.051.??;\$0.053.??;\$0.056.;9) At a volume of 20,000 units, Dries reported sales revenues of \$1,000,000, variable costs of \$300,000, and fixed costs of \$260,000. The company's contribution margin per unit is;\$22.?;\$28.?;\$35.?;\$37.?;an amount other than those above.;10) A forecast of a cost at a particular level of activity is termed;cost estimation.?;cost prediction.?;cost behavior.?;cost analysis.?;cost approximation.;11) At a volume of 20,000 units, Dries reported sales revenues of \$1,000,000, variable costs of \$300,000, and fixed costs of \$260,000. The company's break-even point in units is;7,027 (rounded).?;8,667 (rounded).?;9,286 (rounded).?;7,429 (rounded).?;an amount other than those above.?;12) The difference between budgeted sales revenue and break-even sales revenue is the;contribution margin.?;contribution-margin ratio.?;safety margin.?;target net profit.?;operating leverage.?;13) DuChien Corporation recently produced and sold 100,000 units. Fixed costs at this level of activity amounted to \$50,000, variable costs were \$100,000. How much cost would the company anticipate if during the next period it produced and sold 102,000 units?;\$150,000.?;\$151,000.?;\$152,000.?;\$153,000.?;Some other amount not listed above.;14) Which of the following costs changes in direct proportion to a change in the activity level?;variable cost.?;fixed cost.?;semivariable cost.?;step-variable cost.?;step-fixed cost.;15) Northlake, Inc., uses the high-low method to analyze cost behavior. The company observed that at 20,000 machine hours of activity, total maintenance costs averaged \$10.50 per hour. When activity jumped to 24,000 machine hours, which was still within the relevant range, the average total cost per machine hour was \$9.75. On the basis of this information, the company's fixed maintenance costs were;\$24,000.?;\$90,000.?;\$210,00.?;\$234,000.?;an amount other than those listed above.;16) Yellow Dot, Inc. sells a single product for \$10. Variable costs are \$4 per unit and fixed costs total \$120,000 at a volume level of 10,000 units. What dollar sales level would Yellow Dot have to achieve to earn a target profit of \$240,000?;\$400,000.?;\$500,000.?;\$600,000.?;\$750,000.?;\$900,000.;17) Booster, Inc. recently conducted a least-squares regression analysis to predict selling expenses. The company has constructed the following regression equation: Y = 329,000 + 7.80X. Which of the following statements is false if the primary cost driver is number of units sold?;The company anticipates \$329,000 of fixed selling expenses.?;Y" represents total selling expenses.?;The company expects both variable and fixed selling expenses.?;For each unit sold, total selling expenses will increase by \$7.80.?;X" represents the number of hours worked during the period.;18) Within the relevant range, a curvilinear cost function can sometimes be graphed as a;sloping straight line.?;jagged line.?;vertical straight line.?;curved line.?;horizontal straight line.;19) Swanson and Associates presently leases a copy machine under an agreement that calls for a fixed fee each month and a charge for each copy made. Swanson made 7,000 copies and paid a total of \$360 in March, in May, the firm paid \$280 for 5,000 copies. The company uses the high-low method to analyze costs.?How much would Swanson's pay if it made 5,500 copies?;\$382.50.??;\$322.??;\$300.??;\$292.50;20) Swanson and Associates presently leases a copy machine under an agreement that calls for a fixed fee each month and a charge for each copy made. Swanson made 7,000 copies and paid a total of \$360 in March, in May, the firm paid \$280 for 5,000 copies. The company uses the high-low method to analyze costs.?Swanson's monthly fixed fee is;\$80;\$102.??;\$106.??;\$112.

Paper#80788 | Written in 18-Jul-2015

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