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# Previous Test 2-1 - Accounting 203 Test 2 Name 1 During...

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Accounting 203 Test 2 Name__________________ 1. During March, Adams Company had sales of \$5,000,000, variable expenses of \$3,000,000, and fixed expenses of \$1,500,000. Assume that cost behavior and unit selling price remain unchanged during Aril. In order for the company to realize net operating income of \$300,000 for April, sales would have to be: A) \$3,750,000. B) \$4,050,000. C) \$4,500,000. D) \$4,800,000. 2. The cost of goods sold in a merchandising firm typically would be classified as a: 3. Contribution margin means: 4. The contribution margin ratio is 25% for Grain Company and the break-even point in sales is \$200,000. If Grain Company's target net operating income is \$60,000, sales would have to be: Version 1 Page 1

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Use the following to answer questions 5-8: Stewart Company is attempting to classify costs according to their cost behavior. Data concerning activity and costs are listed below: J a n u a r y F e b r u a r y S a l e s i n u n i t s . . . . . . . . . . 1 , 2 0 0 1 , 4 0 0 M a i n t e n a n c e . . . . . . . . . . . \$ 6 0 0 \$ 7 0 0 S u p p l i e s . . . . . . . . . . . . . . . . . 7 5 0 7 9 0 I n s u r a n c e . . . . . . . . . . . . . . . . 8 0 0 8 0 0 U t i l i t i e s . . . . . . . . . . . . . . . . . . 8 8 8 1 , 0 3 6 L u b r i c a t i o n . . . . . . . . . . . . 5 6 0 5 7 6 A d v e r t i s i n g . . . . . . . . . . . . 9 0 0 1 , 0 5 0 T o t a l . . . . . . . . . . . . . . . . . . . . . . . \$ 4 , 4 9 8 \$ 4 , 9 5 2 5. The cost(s) that Stewart Company would classify as fixed would be: A) insurance. B) insurance and lubrication. C) supplies and lubrication. D) insurance and advertising. 6. The costs that Stewart Company would classify as variable would be: 7. The costs that Stewart Company would classify as mixed would be:
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Previous Test 2-1 - Accounting 203 Test 2 Name 1 During...

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