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(Set E) (MC) Chapter 19 - Cost Behavior and Cost-Volume-Profit Analysis Examination Question and Answers

This document contains 50 multiple choice questions about cost behavior and cost-volume-profit analysis. Specifically, the questions cover calculating break-even points given different levels of fixed costs, unit contribution margins, changes in variable costs, and how adjustments to these factors impact break-even points. The questions range from difficulty level 3 to 5.

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John Carlos Doringo
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319 views

(Set E) (MC) Chapter 19 - Cost Behavior and Cost-Volume-Profit Analysis Examination Question and Answers

This document contains 50 multiple choice questions about cost behavior and cost-volume-profit analysis. Specifically, the questions cover calculating break-even points given different levels of fixed costs, unit contribution margins, changes in variable costs, and how adjustments to these factors impact break-even points. The questions range from difficulty level 3 to 5.

Uploaded by

John Carlos Doringo
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOC, PDF, TXT or read online on Scribd
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Chapter 19—Cost Behavior and Cost-Volume-Profit Analysis

MULTIPLE CHOICE

41. If fixed costs are $200,000 and the unit contribution margin is $20, what amount of units
must be sold in order to have a zero profit?
a. 25,000
b. 20,000
c. 200,000
d. 10,000
ANS: D DIF: 3 OBJ: 03

42. If fixed costs are $500,000 and the unit contribution margin is $12, what amount of units must
be sold in order to realize an operating income of $100,000?
a. 5,000
b. 41,667
c. 50,000
d. 58,333
ANS: C DIF: 3 OBJ: 03

43. If fixed costs are $500,000 and the unit contribution margin is $20, what is the brea k-even point
in units if fixed costs are reduced by $80,000?
a. 25,000
b. 29,000
c. 4,000
d. 21,000
ANS: D DIF: 3 OBJ: 03

44. If fixed costs are $500,000 and the unit contribution margin is $40, what is the break-even point
if fixed costs are increased by $80,000?
a. 14,500
b. 12,500
c. 8,333
d. 9,667
ANS: A DIF: 3 OBJ: 03

45. If fixed costs are $561,000 and the unit contribution margin is $8.00, what is the break-even point
in units if variable costs are decreased by $.50 a uni t?
a. 66,000
b. 70,125
c. 74,800
d. 60,000
ANS: A DIF: 3 OBJ: 03
46. If variable costs per unit increased because of an increase in hourly wage rates, the break-
even point would:
a. decrease
b. increase
c. remain the same
d. increase or decrease, depending upon the percentage increase in wage rates
ANS: B DIF: 5 OBJ: 03

47. If variable costs per unit decreased because of a decrease in utility rates, the break-even point
would:
a. decrease
b. increase
c. remain the same
d. increase or decrease, depending upon the percentage increase in utility rates
ANS: A DIF: 5 OBJ: 03

48. If fixed costs increased and variable costs per unit decreased, the break-even point would:
a. increase
b. decrease
c. remain the same
d. increase, decrease, or remain the same, depending upon the amounts of increase in fixed
cost and decrease in variable cost
ANS: D DIF: 5 OBJ: 03

49. Which of the following conditions would cause the break-even point to decrease?
a. Total fixed costs increase
b. Unit selling price decreases
c. Unit variable cost decreases
d. Unit variable cost increases
ANS: C DIF: 5 OBJ: 03

50. Which of the following conditions would cause the break-even point to increase?
a. Total fixed costs decrease
b. Unit selling price increases
c. Unit variable cost decreases
d. Unit variable cost increases
ANS: D DIF: 5 OBJ: 03

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