If variable costs per unit increased because of an increase in hourly wage rates, the break-even point would:

a. increase.
b. remain the same.
c. decrease.

d. increase or decrease, depending upon the percentage increase in wage rates.

Zeke Company sells 25,000 units at $21 per unit. Variable costs are $10 per unit, and fixed costs are $75,000. The contribution margin ratio and the unit contribution margin are:

a. 53% and $7 per unit.
b. 47% and $11 per unit.
c. 52% and $11 per unit.

d. 47% and $8 per unit.

If sales are $500,000, variable costs are 75% of sales, and operating income is $40,000, what is the operating leverage?

a. 0
b. 1.3
c. 3.1

d. 1.25

Which of the following describes the behavior of the fixed cost per unit?

a. Increases with increasing production
b. Remains constant with changes in production
c. Decreases with increasing production

d. Decreases with decreasing production

If variable costs per unit decreased because of a decrease in utility rates, the break-even point would:

a. increase.
b. increase or decrease, depending upon the percentage increase in utility rates.
c. decrease.

d. remain the same.

Costs that vary in total in direct proportion to changes in an activity level are called:

a. differential costs.
b. fixed costs.
c. variable costs.

d. sunk costs

Which of the following conditions would cause the break-even point to increase?

a. Total fixed costs decrease
b. Unit variable cost decreases
c. Unit variable cost increases

d. Unit selling price increases

In cost-volume-profit analysis, all costs are classified into the following two categories:

a. discretionary costs and sunk costs
b. variable costs and fixed costs
c. mixed costs and variable costs
d. sunk costs and fixed costs

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Nelly Stracke
Nelly StrackeLv2
28 Sep 2019

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