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Unformatted text preview: CHAPTER 5 CostVolumeProfit ASSIGNMENT CLASSIFICATION TABLE Study Objectives Questions Brief Exercises Exercises A Problems B Problems 1. Distinguish between variable and fixed costs. 1, 2, 3, 6 1 1, 2, 3, 4, 5, 6 1A 1B 2. Explain the significance of the relevant range. 4, 5 2 2 3. Explain the concept of mixed costs. 6, 7, 8 1, 3, 4, 5 1, 3, 4, 5, 6 1A 1B 4. List the five components of costvolumeprofit analysis. 9 7 5. Indicate what contribution margin is and how it can be expressed. 10, 11, 17 6, 7 8, 9, 10, 11, 12, 13 1A, 2A, 3A, 4A, 5A 1B, 2B, 3B, 4B, 5B 6. Identify the three ways to determine the breakeven point. 12, 13, 14 8, 9 8, 9, 10, 11, 12, 13, 14, 16 1A, 2A, 3A, 4A, 5A 1B, 2B, 3B, 4B, 5B 7. Give the formulas for determining sales required to earn target net income. 16 10, 12 14, 15 2A, 5A 2B, 5B 8. Define margin of safety, and give the formulas for computing it. 15 11 16 2A, 4A, 5A 2B, 4B, 5B 2008 For Instructor Use Only 51 ASSIGNMENT CHARACTERISTICS TABLE Problem Number Description Difficulty Level Time Allotted (min.) 1A Determine variable and fixed costs, compute breakeven point, prepare a CVP graph, and determine net income. Simple 2030 2A Prepare a CVP income statement, compute breakeven point, contribution margin ratio, margin of safety ratio, and sales for target net income. Moderate 3040 3A Compute breakeven point under alternative courses of action. Simple 2030 4A Compute breakeven point and margin of safety ratio, and prepare CVP income statement before and after changes in business environment. Moderate 2030 5A Compute contribution margin, fixed costs, breakeven point, sales for target net income, and margin of safety ratio. Moderate 2030 1B Determine variable and fixed costs, compute breakeven point, prepare a CVP graph, and determine net income. Simple 2030 2B Prepare a CVP income statement, compute breakeven point, contribution margin ratio, margin of safety ratio, and sales for target net income. Moderate 3040 3B Compute breakeven point under alternative courses of action. Simple 2030 4B Compute breakeven point and margin of safety ratio, and prepare CVP income statement before and after changes in business environment. Moderate 2030 5B Compute contribution margin, fixed costs, breakeven point, sales for target net income, and margin of safety ratio. Moderate 2030 2008 For Instructor Use Only 52 BLOOMS TAXONOMY TABLE 2008 For Instructor Use Only 53 ANSWERS TO QUESTIONS 1. (a) Cost behavior analysis is the study of how specific costs respond to changes in the level of activity within a company. (b) Cost behavior analysis is important to management in planning business operations and in deciding between alternative courses of action....
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This note was uploaded on 07/16/2010 for the course ACCT 2302 taught by Professor Dr.winking during the Spring '10 term at Tulane.
 Spring '10
 Dr.Winking
 Managerial Accounting

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