Chapter 21 QUIZ 219 – Flashcards
9 test answers
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Most operating decisions of management focus on a narrow range of activity called the A. strategic level of production B. optimal level of production C. relevant range of production D. tactical operating level of production
answer
C. relevant range of production
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Which of the following describes the behavior of a variable cost per unit? A. varies in increasing proportion with changes in the activity level B. varies in direct proportion with the activity level B. remains constant with changes in the activity level C. varies in decreasing proportion with changes in the activity level
answer
B. remains constant with changes in the activity level
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For purposes of analysis, mixed costs are A. separated into their variable and fixed cost components B. classified as variable costs C. classified as fixed costs D. classified as period costs
answer
A. separated into their variable and fixed cost components
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The contribution margin ratio is A. the same as the profit-volume ratio B. the same as profit C. the same as the variable cost ratio D. the portion of equity contributed by the stockholders
answer
A. the same as the profit-volume ratio
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If fixed costs are $400,000 and the unit contribution margin is $20, what amount of units must be sold in order to have a zero profit? A. 10,000 units B. 25,000 units C. 20,000 units D. 400,000 units
answer
C. 20,000 units
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