A revenue driver is defined as a any factor that

This preview shows page 6 - 9 out of 18 pages.

3) A revenue driver is defined as: A) any factor that affects costs and revenues B) any factor that affects revenues C) only factors that can influence a change in selling price D) only factors that can influence a change in demand Answer:
B4) Operating income calculations use:
C5) Contribution margin equals:
C6
Answer the following questions using the information below:Holly's Hams, Inc. sells hams during the major holiday seasons. During the current year 10,000 hams were sold resulting in $355,000 of sales revenue, $55,000 of variable costs, and $24,000 offixed costs.6) Contribution margin per ham is:
B
7) If sales increase by $100,000, operating income will increase by: A) $10,000 B) $20,000 C) $30,000 D) None of these answers are correct. Answer: Explanation: C) Price = $355,000/10,000 = $35.5Sales in hams = $100,000/$35.5 = 2,817 hamsOperating Income increase = 2,817 hams x $30.00 per = $84,510
D
Answer the following questions using the information below:Holly's Hams, Inc. sells hams during the major holiday seasons. During the current year 11,000 hams were sold resulting in $220,000 of sales revenue, $55,000 of variable costs, and $24,000 offixed costs.8) Breakeven point in units is:
C7
9) The number of hams that must be sold to achieve $75,000 of operating income is:
A
10) At the breakeven point of 2,000 units, variable costs total $4,000 and fixed costs total $6,000.The 2,001st unit sold will contribute ________ to profits.
C
11) If sales increase by $40,000, operating income will increase by: A) $10,000 B) $20,000 C) $30,000 D) None of these answers is correct. Answer: Explanation: C) Price = $220,000/11,000 = $20.00Sales in hams = $40,000/$20.00 = 2,000 hamsOperating Income increase = 2,000 hams x $15.00 per = $30,000
C
12) The margin of safety is the difference between:
BAnswer the following questions using the information below:Dr. Charles Hunter, MD, performs a certain outpatient procedure for $1,000. His fixed costs are $20,000, while his variable costs are $500 per procedure. Dr. Hunter currently plans to perform 200 procedures this month.

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture