If fixed costs are a __________ percentage of __________, operating leverage is __________. A. small / total costs / low B. small / total sales / low C. small / total costs / high D. large / total costs / low
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If fixed costs are a __________ percentage of __________, operating leverage is __________.
small / total costs / low
small / total sales / low
small / total costs / high
large / total costs / low
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- The amount of a unit’s sales price that helps to cover fixed expenses is its ________.A. contribution marginB. profitC. variable costD. stepped costIdentify the formula that computes the degree of operating leverage (DOL). a.Total variable cost / Sales b.Unit variable cost / Price c.Break-even sales / Variable cost ratio d.Total contribution margin / Operating income e.Sales / Unit contribution margFixed cost per unit ______ A. Can be estimated by the high - low method. B. Remains the same when the level of activity changes. C. Are represented by the slope of the total cost line. D. All of the above answers are correct.
- Variable cost varies _____ with output. a. Disproportionately b. Proportionately c. More than proportionately d. Less than proportionatelyOperating Leverage=Quantity×(Price per unit-Variable cost per unit)Quantity×(Price per unit-Variable cost per unit)-Fixed operating cost is the correct function?When the total fixed costs decrease, the contribution margin per unit ________. A. increases B. decreases C. decreases proportionately D. remains the same
- Fixed costs per unit _______. .1. can be estimated by the high-low method 2. remains the same when the level of activity changes 3. are represented by the slope of the total cost line. 4. all of the aboveWhich of the following best describes a variable cost? A cost that: a. Represents a fixed proportion of total costs b. Has a direct relationship with outputc. Is sometimes also known as an indirect cos d. Falls on average, as output increases.Given the mixed cost function y = $6.50x + $3,000. What does the $6.50 represent? a.Total cost per unit of the cost driver b.The fixed cost per unit c.The slope of the cost function d.Total fixed costs
- 1. The slope of line B is equal to the: a. fixed cost per unit. b. selling price per unit. c. variable cost per unit. d. profit per unit. e. unit contribution margin. 2. Line A is the: a. total revenue line. b. Option 2 c. fixed cost line. d. variable cost line. e. total cost line. f. profit line.The amount of a units sales price that helps to cover fixed expenses is its ____________________. A. contribution margin B. profit C. variable cost D. stepped cost1. The formula used to calculate the number of units needed in order to earn a target income is a. (Fixed costs + variable costs) / Sales b. (Fixed costs + target income) / Sales c. (Fixed costs + target income) / CM per unit d. (Fixed costs + variable costs) / CM per unit 2. The indifference point is reached when * a. The savings in variable cost is equal to the increase in fixed costs. b. The savings in variable cost is less than the increase in fixed costs. c. The savings in fixed cost is equal to the decrease in variable cost. d. The savings in fixed cost is more than the increase in variable costs.' 3. Which of the following is not an assumption used to prepare a cost-volume-profit graph? * a. Constant sales mix b. Constant cost fluctuations c. Units produced equal units sold d. Liner costs within the relevant range
