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questions:
A2. How many units per month must Boxware sell in order to break even?
a. 500
b. 1000
c. 1500
d. 2000
A3. What amount of dollar sales must Boxware achieve each month in order to break even?
a. $95,000
b. $190,000
c. $285,000
d. $380,000
C4. How many units per month must Boxware sell in order to make a $110,000 profit?
a. 500
b. 1,000
c. 1,500
d. 2,000
Use the following information to answer the next three questions: Derek's Drum Depot (DDD) wants to add a
new line of drumsticks to its product line. The following data apply to the new drumsticks line.
D7. How many sets of drumsticks must DDD sell to make a profit of $50,000 on the new line?
a. 2,000 units
b. 10,000 units
c. 20,000 units
d. 30,000 units
Use the following data for Fireware Software Corporation to answer the next four questions:
D8. If Fireware makes 2,500 units, total fixed cost would be?
a. $6.89
b. $17,225
c. $11,133
d. $14,469
C9. How many units must Fireware sell in order to break even? (round to the nearest whole unit)
a. 308
b. 500
c. 614
d. 620
D10. How many units must Fireware sell in order to make a $50,000 profit? (Round to the nearest whole unit.)
a. 505
b. 1,090
c. 1,708
d. 2,734
5. Paul's Pizza produced and sold 2,000 pizzas last month and had
fixed
costs of $6,000. If production and sales are expected to
increase
by 10% next month, which of the following statements is true?
a. Total fixed costs will increase.
b. Total fixed costs will decrease.
c. Fixed cost per unit will increase.
d. Fixed cost per unit will decrease.
8. You've rented a video for the evening when a friend calls and
asks
you to attend a concert tonight. Which of the following is a
sunk
cost in this situation?
a. the cost of the concert ticket
b. the video rental fee
c. your share of the cost of the gas to get to the concert which
will depend on the number of people riding in the car
d. None of these is a sunk cost.
13. Which of the following skills will be needed by those who desire
a
high-level career in management accounting?
a. written and oral communication skills
b. interpersonal skills
c. knowledge of the industry in which their firm competes
d. All of these skills are necessary for success in management
accounting.
16. The variable cost per unit and fixed cost per unit are,
respectively
a. $8.50 and $3.00.
b. $17.50 and $0.50.
c. $17.50 and $3.00.
d. $8.50 and $12.00.
17. If production changes to 1,200 units, the variable cost per unit
and
fixed cost per unit will be
a. $17.50 and $2.50.
b. $14.58 and $2.50.
c. $17.50 and $3.00.
d. $14.58 and $3.00.
18. If production changes to 800 units, the total variable costs and
total fixed costs will be
a. $17,500 and $3,000.
b. $14,000 and $3,000.
c. $17,500 and $2,250.
d. $14,000 and $2,250.
19. Variable cost per unit is budgeted to be $6.00 and fixed cost per
unit is budgeted to be $3.00 in a period when 5,000 units are
produced. If production is actually 4,500 units, what is the
expected total cost of the units produced?
a. $45,000
b. $40,500
c. $43,500
d. $42,000
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Nick's Novelties has collected the following information over the
last six months.
27. Using the high-low method, what is the variable cost per unit?
a. $0.22
b. $0.25
c. $2.00
d. $2.56
28. Using the high-low method, what is the total fixed cost?
a. $23,100
b. $1,000
c. $5,600
d. $4,500
29. Using the high-low method, what is the estimated total cost in a
month when 12,000 units are produced?
a. $26,000
b. $26,100
c. $26,200
d. $24,000
30. Which of the following costs does not change when the level of
business activity changes?
a. total fixed costs
b. total variable costs
c. total direct materials costs
d. fixed costs per unit