Exam 2 Chapter 7

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Posted on

March 14th, 2023

question

inventory levels will increase.

answer

CVP analysis assumes all of the following except

question

true

answer

The breakeven point represents the minimum number of units a company must sell before it earns a profit.

question

true

answer

Fixed costs of $15,750 divided by the contribution margin ratio of 50% would yield the dollar amount of breakeven sales as $31,500.

question

Breakeven point in units increases.

answer

If the variable cost per unit increases while the sale price per unit and total fixed costs remain constant, which of the following statements is
true?

question

true

answer

The margin of safety is the excess of expected sales over breakeven sales.

question

false

answer

Gross margin is another term for net income.

question

true

answer

If all other factors are constant, any decrease in fixed costs will decrease the breakeven point

1 of 7

question

inventory levels will increase.

answer

CVP analysis assumes all of the following except

question

true

answer

The breakeven point represents the minimum number of units a company must sell before it earns a profit.

question

true

answer

Fixed costs of $15,750 divided by the contribution margin ratio of 50% would yield the dollar amount of breakeven sales as $31,500.

question

Breakeven point in units increases.

answer

If the variable cost per unit increases while the sale price per unit and total fixed costs remain constant, which of the following statements is
true?

question

true

answer

The margin of safety is the excess of expected sales over breakeven sales.

question

false

answer

Gross margin is another term for net income.

question

true

answer

If all other factors are constant, any decrease in fixed costs will decrease the breakeven point

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