EXAM_3_Sample_questions

EXAM_3_Sample_questions - breakeven point in volume is 250...

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<1>A variable cost is a cost that changes in total dollar amount as a result of a change in volume. True False <2>Sales commissions are an example of a variable cost. True False <3>The president’s salary is a variable cost. True False <4>Electricity is a fixed cost. True False <5>The factory insurance is a direct cost. True False <6>Differential costs are relevant costs. True False <7>Donations to charity solicited by telephone are a committed cost. True False <8>Sales at the breakeven point means that the company is operating at a profit. True False <9>If selling price is \$10 and variable cost is \$4, then the contribution margin ratio is 40%. True False <10>If fixed costs total \$2,500 and the contribution margin per unit is \$10, then the

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Unformatted text preview: breakeven point in volume is 250 units. True False &amp;lt;11&amp;gt;If a companys sales total \$24,000, variable costs are \$16,000, and fixed costs total \$6,000, a 10% increase in selling price will result in a net income of \$4,400. True False &amp;lt;12&amp;gt;The starting point in the master budgeting process is the cash budget. True False &amp;lt;13&amp;gt;Which one of the following formulas is the proper method for determining the labor effi1ciency variance? A. (AR vs SR) x AH B. (AH vs SH) x AR C. (AH vs SH) x SR D. (AH x AR) + (SH x SR) 1. True 2. True 3. False 4. False 5. False 6. True 7. False 8. False 9. False 10. True 11. True 12. False 13. C...
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EXAM_3_Sample_questions - breakeven point in volume is 250...

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