ACC prework

If operating leverage is high, a small percentage increase in sales produces a __________(higher/lower) percentage increase in net operating income than if operating leverage is low.

blank 1: higher

A measure of how sensitive net operating income is to a given percentage change in sales dollars is known as operating __________.

blank 1: leverage

The amount by which sales can drop before losses are incurred is the __________ of _________.

blank 1: margin blank 2: safety

The first major step when implementing an ABC system is ______. Multiple choice question. assign overhead costs compute the activity measure classify cost pools identify the activities

identify the activities

In activity-based costing, first-stage allocation assigns __________ costs to activity cost pools.

overhead

A company sold 20,000 units of its product for $20 each. Variable cost per unit is $11. Fixed expenses total $150,000. The company's contribution margin is ______. Multiple choice question. $180,000 $150,000 $30,000 $130,000

$180,000Contribution margin = 20,000 x ($20-$11) = $180,000

Activity rates are used to apply overhead costs to products and customers in the __________-stage allocation.

second

In activity-based costing, the consumption of overhead resources is caused by ______. Multiple choice question. direct labor an activity material purchases overhead

an activity

True or false: Without knowing the future, it is best to have a cost structure with high variable costs. True false question. True False

false

Ceramic Creations sells pots for $25. The variable cost per pot is $12 and 15,000 pots must be sold to break-even. If Ceramic Creations sells 25,000 pots, net operating income will be ______. Multiple choice question. $130,000 $0 $325,000 $250,000

$130,000 Reason: Net income = (25,000 - 15,000) × ($25 - $12) = $130,000.

Adam's Sports Store has a contribution margin ratio of 55% and has already passed the break-even point for the year. If Adam's generates additional sales of $250,000 by year-end, net operating income will increase by ______. Multiple choice question. $137,500 $112,500 $250,000

$137500 = $250000*55% = $137500

Select all that apply Adams, Inc. has sales of $100,000 with a contribution margin of $60,000 and net income of $20,000. Baron, Inc. has sales of $110,000 with a contribution margin of $44,000 and net income of $22,000. Which of the following statements are correct? Multiple select question. Adams has a higher degree of operating leverage than Baron. If sales fall, Baron will experience a greater decrease in income than Adams. Baron's net income grows twice as fast as its sales.

Adams has a higher degree of operating leverage than Baron. Baron's net income grows twice as fast as its sales.

The break-even point is the level of sales at which the profit equals ______

zero

The break-even point is the level of sales at which the profit equals __________

zero

Given a sales price of $100, variable costs of $70 and a break-even point of 500 units, net operating profit for sale of 501 units will be $___

$30 100-70=30. For every unit above break-even, profit increases by the contribution margin per unit.

Daisy's Dolls sold 30,000 dolls this year. Each doll sold for $40 and had a variable cost of $19. Fixed expenses were $250,000. Net operating income for the year is ______. Multiple choice question. $(249,979) $1,520,000 $380,000 $630,000

$380,000 Reason: Net operating income =30,000 × ($40 - $19) - $250,000 = $380,000

Run Like the Wind sells ceiling fans. Target profit for the year is $470,000. If each fan's contribution margin is $32 and fixed costs total $222,640, the number of fans required to meet the company's goal is ______. Multiple choice question. 7,730 6,958 21,645 14,688

21,645 Reason: Sales volume = ($470,000 + $222,640) ÷ $32 = 21,645 fans.

Given sales of $1,452,000, variable expenses of $958,320 and fixed expenses of $354,000, the contribution margin ratio is ______. Multiple choice question. 24% 90% 34% 66%

34% Reason: Contribution margin ratio = ($1,452,000 - $958,320) ÷ $1,452,000 = 34%.

Contribution margin ratio is equal to ______ ______ divided by ______.

blank 1: contribution blank 2: margin blank 3: sales or revenue

Contribution margin ratio is equal to _________ __________ divided by __________.

blank 1: contribution blank 2: margin blank 3: sales or revenue

Contribution margin is first used to cover __________ expenses. Once the break-even point has been reached, contribution margin becomes __________

blank 1: fixed blank 2: profit or income

Activities that occur regardless of which customers are served, which products are produced or how many batches are run or units made are facility-level or __________-__________ activities.

blank 1: organization, organizational, or organization blank 2: sustaining

Activity based costing provides managers with information that affects ______. Multiple choice question. neither fixed nor variable costs only fixed costs only variable costs both fixed and variable costs

both fixed and variable costs

In activity-based costing, nonmanufacturing and manufacturing costs are assigned to products on a(n) ______ basis. Multiple choice question. as needed day-to-day compare-and-contrast cause-and-effect

cause-and-effect

The calculation of contribution margin (CM) ratio is ______. Multiple choice question. variable expenses ÷ contribution margin contribution margin ÷ total expenses net operating income ÷ total contribution margin contribution margin ÷ sales

contribution margin ÷ sales

Select all that apply CVP analysis allows companies to easily identify the change in profit due to changes in ______. Multiple select question. management costs location selling price volume

costs selling price volume

A cost pool including costs to entertain clients and make sales calls is a(n) ______ activity. Multiple choice question. unit-level product-level batch-level customer-level

customer-level

Seating Galore sells high-end desk chairs. The variable expense per chair is $85.05 and the chairs sell for $189.00 each. The variable expense ratio for Seating Galore's chairs is _____%

45

A product has a selling price of $10 per unit, variable expenses of $6 per unit and total fixed costs of $35,000. If 10,000 units are sold, net operating income will be $___

5000(10-6)x10000 - 35000 = 5000

True or false: Traditional cost systems tend to undercost standard products and overcost specialty products. True false question. True False

false

In activity-based costing, the process of assigning overhead costs to activity cost pools is ______ stage allocation. Multiple choice question. second fourth first third

first

The term used for the relative proportion in which a company's products are sold is ______. Multiple choice question. operating leverage break-even sales price sales mix

sales mix

The term used for the relative proportion in which a company's products are sold is ______. Multiple choice question. sales mix sales price break-even operating leverage

sales mix

Activity-based costing uses activity rates to apply overhead costs to products in ______ stage allocation. Multiple choice question. third first second fourth

second

An ABC system usually ______ a traditional cost system. Multiple choice question. is the same as supplements replaces

supplements

A reason that activity-based costing is not often used for external reporting is ______. Multiple choice question. ABC product costs exclude nonmanufacturing costs auditors prefer to base allocations on personnel interviews the ABC system may not conform to GAAP individual product costs need to be reported on external reports

the ABC system may not conform to GAAP

A reason that activity-based costing is not often used for external reporting is ______. Multiple choice question. auditors prefer to base allocations on personnel interviews the ABC system may not conform to GAAP ABC product costs exclude nonmanufacturing costs individual product costs need to be reported on external reports

the ABC system may not conform to GAAP

Which of the following statements is correct? Multiple choice question. The risk of loss is not impacted by the margin of safety. The higher the margin of safety, the lower the risk of incurring a loss. The higher the margin of safety, the higher the risk of incurring a loss.

the higher the margin of safety, the lower the risk of incurring a loss

Which of the following is not essential for the successful implementation of an ABC system? Multiple choice question. Top managers must support the ABC system. Top managers should ensure that ABC data is linked to how employees are evaluated and rewarded. Top managers must design the ABC system. A cross-functional team should be created to design and implement the ABC system.

top managers must design the ABC system

In ABC, any event that causes consumption of overhead resources is a(n) __________

activity

In activity-based costing, each cost pool accumulates costs that relate to a single __________ measure in the ABC system.

activity

Focusing on activities to eliminate waste, decrease processing time, and reduce defects is the basis of __________ - __________ __________ .

activity based management

Total cost of each activity divided by the total activity is the computation of ______. Multiple choice question. allocation bases transaction drivers activity rates cost pools

activity rates

Anne's Antique Store has a contribution margin ratio of 29%. The break-even point has been reached. If the store generates an additional $600,000 of sales for the year, net operating income will increase by ______. Multiple choice question. $600,000 $426,000 $174,000

$174,000 Net operating income change = $600,000 × 29% = $174,000

A company's break-even point is 17,000 units. If the contribution margin is $22 per unit and 26,000 units are sold, net operating profit will be ______. Multiple choice question. $0 $572,000 $198,000 $374,000

$198,000 Net operating income = (26,000 - 17,000) × $22 = $198,000

Company A has fixed costs of $564,000 and wishes to earn a profit of $800,000 this year. If Company A has a contribution margin ratio of 62%, sales dollars needed to reach the target profit equals ______. Multiple choice question. $1,364,000 $913,880 $3,000,000 $2,200,000

$2,200,000 Reason: Sales = ($564,000 + $800,000) ÷ 0.62 = $2,200,000

Select all that apply Activity-based management is focused on ______. Multiple select question. increasing processing time reducing defects pricing decisions eliminating waste

- reducing defects - eliminating waste

Spice sells paprika for $9.00 per bottle. Variable cost is $2.43 per bottle and Spice's annual fixed costs are $825,000. The variable expense ratio for paprika is ______. Multiple choice question. 54% 78% 27% 100%

27% =2.43/9

A 15% increase in sales resulted in a 40% increase in net income for Company A and a 60% increase in net income for Company B. Based on this, which company has the greater operating leverage? Multiple choice question. Company A Company B

Company B

Select all that apply Which of the following items are found above the contribution margin on a contribution margin format income statement? Multiple select question. Sales Variable expenses Net operating income Fixed expenses

Sales Variable expenses

Paula's Perfumes has a target profit of $4,000 per month. Perfume sells for $15.00 per bottle and variable costs are $13.50 per bottle. Fixed costs are $3,200 per month. The number of bottles that must be sold each month to earn the target profit is ______.

Sales Volume= (4000+3200) / (15.00-13.50) = 4,800 bottles

External reports are __________ (more/less) detailed than internal reports.

less

A measure of how sensitive net operating income is to a given percentage change in sales dollars is known as operating ___________.

leverage

To prepare a CVP graph, lines must be drawn representing total revenue, ______. Multiple choice question. break-even point, and profit total expense, and profit total expense, and total fixed expense total variable expenses, and total fixed expense

total expense, and total fixed expense

A characteristic essential for successful implementation of ABC is ______. Multiple choice question. top management design and implementation strong support from a cross-functional team a link to how people are evaluated and rewarded

a link to how people are evaluated and rewarded

Costs of unused or idle capacity are assigned to products when using a(n) __________ costing system.

absorption, traditional, or full

The first major step in implementing ABC is to identify the __________ that will form the foundation for the system.

activities or activity

Select all that apply Customer-level activities include ______. Multiple select question. sales calls placing purchase orders advertising mailing catalogs

- sales calls - mailing catalogs

Profit = (selling price per unit × quantity sold) - ( __________ expense per unit × quantity sold) - __________ expenses.

blank 1: variable blank 2: fixed

According to the CVP analysis model and assuming all else remains the same, profits would be increased by a(n) ______. Multiple choice question. change in sales mix increase in total fixed cost decrease in the unit variable cost decrease in unit selling price

decrease in the unit variable cost

Under activity-based costing, nonmanufacturing costs ______. Multiple choice question. are always assigned to products, regardless of cause are never assigned to products may be allocated to products based on cause are always treated as period costs

may be allocated to products based on cause

The most common reports prepared using ABC data are the product and customer __________ reports.

profitability, margin, or profit

Which costing system does not assign selling and administrative costs to products when computing product margin? Multiple choice question. Both traditional and activity-based Traditional Activity-based Neither traditional nor activity-based

traditional

Select all that apply ABC does not conform to GAAP because it ______. Multiple select question. includes some nonmanufacturing costs excludes some nonmanufacturing costs excludes some manufacturing costs includes direct materials and direct labor

- includes some nonmanufacturing costs - excludes some manufacturing costs

Adams, Inc. has sales of $100,000 with a contribution margin of $60,000 and net income of $20,000. Baron, Inc. has sales of $110,000 with a contribution margin of $44,000 and net income of $22,000. Thus, the degree of operating leverage is __________ for Adams, Inc. and __________ for Baron, Inc.

blank 1: 3 or three blank 2: 2 or two

Adams, Inc. has sales of $100,000 with a contribution margin of $60,000 and net income of $20,000. Baron, Inc. has sales of $110,000 with a contribution margin of $44,000 and net income of $22,000. Thus, the degree of operating leverage is ___________ for Adams, Inc. and __________ for Baron, Inc.

blank 1: 3 or three blank 2: 2 or two

To calculate the degree of operating leverage, divide __________ __________ by net operating income.

blank 1: contribution blank 2: margin

The term "cost structure" refers to the relative proportion of __________ and __________ costs in an organization.

blank 1: variable blank 2: fixed

When constructing a CVP graph, the vertical axis represents ______. Multiple choice question. unit volume dollars fixed costs variable costs

dollars

The relative proportions in which a company's products are sold is referred to as __________ __________.

sales, mix

Vivian's Violins has sales of $326,000, contribution margin of $184,000 and fixed costs total $85,000. Vivian's Violins net operating income is ______. Multiple choice question. $99,000 $57,000 $241,000

$184,000-$85,000=$99,000

Net operating income equals ______. Multiple choice question. unit sales × unit contribution margin dollar sales - dollar sales to break even (dollar sales - dollar sales to break even) × unit contribution margin (unit sales - unit sales to break even) × unit contribution margin

(unit sales - unit sales to break even) × unit contribution margin

Net operating income equals ______. Multiple choice question. unit sales × unit contribution margin dollar sales - dollar sales to break even (unit sales - unit sales to break even) × unit contribution margin (dollar sales - dollar sales to break even) × unit contribution margin

(unit sales - unit sales to break even) × unit contribution margin

Select all that apply The most common management reports using ABC data are ______. Multiple select question. first-stage allocation second-stage allocation customer profitability product profitability

- customer profitability - product profitability

Select all that apply Costs assigned and/or traced when computing product margin in a traditional cost system are ______. Multiple select question. direct material selling and administrative manufacturing overhead direct labor

- direct material - manufacturing overhead - direct labor

Select all that apply Organization-sustaining activities include ______. Multiple select question. heating a factory arranging product shipments to customers setting up a computer network preparing annual reports

- heating a factory - setting up a computer network - preparing annual reports

Select all that apply A company with a high ratio of fixed costs ______. Multiple select question. will be able to avoid some of the fixed costs when sales decrease by lowering production is more likely to experience greater profits when sales are up than a company with mostly variable costs. will not be concerned about fluctuating sales is more likely to experience a loss when sales are down than a company with mostly variable costs

- is more likely to experience greater profits when sales are up than a company with mostly variable costs. - is more likely to experience a loss when sales are down than a company with mostly variable costs

The calculation of contribution margin (CM) ratio is ______. Multiple choice question. contribution margin ÷ sales variable expenses ÷ contribution margin contribution margin ÷ total expenses net operating income ÷ total contribution margin

contribution margin ÷ sales

The calculation of contribution margin (CM) ratio is ______. Multiple choice question. contribution margin ÷ total expenses variable expenses ÷ contribution margin contribution margin ÷ sales net operating income ÷ total contribution margin

contribution margin ÷ sales

Total contribution margin equals ______. Multiple choice question. variable expenses plus net operating income fixed expenses plus net operating income total sales minus fixed expenses total sales minus net operating income

fixed expenses plus net operating income

Select all that apply At the break-even point ______. Multiple select question. the company is earning a profit total revenue equals total cost the company is experiencing a loss net operating income is zero

total revenue equals total cost net operating income is zero

What level of activity is performed each time an item of a product is produced? Multiple choice question. Customer-level Unit-level Product-level Batch-level

unit-level

Company A has a contribution margin ratio of 35%. For each dollar in sales, contribution margin will increase by ______. Multiple choice question. $0.35 $0.65

$0.35

Softie, Inc. produces facial tissues. The company's contribution margin ratio is 77%. Fixed expenses are $240,400. To achieve a target profit of $930,000, Softies' sales must be ______. Multiple choice question. $1,170,400 $5,088,695 $1,242,408 $1,520,000

$1,520,000 Reason: Sales = ($240,400 + $930,000) ÷ 0.77= $1,520,000

A company reported $100,000 in sales and $80,000 in variable costs at the breakeven point of 200 units. If the company sells 201 units, net profit will be ______. Multiple choice question. $500 $100 $400 $200

$100 Reason: For each unit sold above break-even, profit increases by the contribution margin per unit ($100,000 - $80,000) ÷ 200 or $100.

Budgeted sales are $982,000, break-even sales are $932,200, and fixed expenses are $429,000. The company's budgeted margin of safety in dollars is ______. Multiple choice question. $49,800 $503,200 $(379,200) $553,000

$49,800 $982,000 - $932,000 = $49,800

Company A's product sells for $90 and has a variable cost of $35 per unit. Fixed costs total $550,000. If Company A sells 16,000 units, the contribution margin per unit is ______. Multiple choice question. $880,000 $10,000 $20.63 $55

$55 Reason: Unit contribution margin= $90 -$35 = $55.

Seth's Speakers had actual sales of $1,630,000 If break-even sales equals $935,000, Seth's margin of safety in dollars is ______. Multiple choice question. $935,000 $695,000 $1,630,000 $2,565,000

$695,000 Reason: $1,630,000 - $935,000 = $695,000

A company's total expected overhead for the year is $500,000. Two activity cost pools have been identified: Customer Service with a total cost of $200,000 and a total activity of 25,000 customer service calls; and Product Development with a total cost of $300,000 and total activity of 20,000 development hours. Using activity-based costing, calculate the appropriate activity rate(s). Multiple choice question. $20 per customer call and $25 per development hour $11.11 per customer call or per development hour $8 per customer call and $15 per development hour

$8 per customer call and $15 per development hour Reason: $200,000 ÷ 25,000 = $8 per customer call and $300,000 ÷ 20,000 = $15 per development hour.

Select all that apply An activity-based costing system ______. Multiple select question. is costly to maintain requires substantial resources provides benefits of improved accuracy that always outweigh the costs produces different numbers than a traditional system

- is costly to maintain - requires substantial resources - produces different numbers than a traditional system

Select all that apply A company with a high ratio of fixed costs ______. Multiple select question. is more likely to experience a loss when sales are down than a company with mostly variable costs will not be concerned about fluctuating sales will be able to avoid some of the fixed costs when sales decrease by lowering production is more likely to experience greater profits when sales are up than a company with mostly variable costs.

- is more likely to experience a loss when sales are down than a company with mostly variable costs - is more likely to experience greater profits when sales are up than a company with mostly variable costs.

Select all that apply Activity-based costing only charges products for the cost of the capacity used because ______. Multiple select question. it results in a more stable unit product cost products are only assigned the costs of resources they actually use assigning costs of unused capacity artificially reduces product cost per unit

- it results in a more stable unit product cost - products are only assigned the costs of resources they actually use

Select all that apply What are some of the limitations of activity-based costing systems? Multiple select question. The benefits of accuracy always outweigh the costs. Managers and employees may resist the change to ABC. ABC procedures produce numbers that do not match traditional costing. ABC requires substantial resources.

- managers and employees may resist the change to ABC - ABC procedures produce numbers that do not match traditional costing - ABC requires substantial resources

Select all that apply Costs that can be easily traced to individual products include ______. Multiple select question. sales commission factory supervisor's salary shipping costs warranty repair costs

- sales commission - shipping costs - warranty repair costs

Click and drag on elements in order Place the steps for implementing ABC in order.

1. define activities, activity cost pools, and activity measures 2. assign overhead costs to activity cost pools 3. calculate activity rates 4. assign overhead costs to cost objects 5. prepare management reports

True or false: Cost structure refers to the relative portion of product and period costs in an organization. True false question. True False

false

Gifts Galore had sales revenue of $189,000. Total contribution margin was $100,170 and total fixed expenses were $27,500. The contribution margin ratio was ______. Multiple choice question. 47% 68% 38% 53%

53%(100,170/189,000 = 53%)

A company has a target profit of $204,000. The company's fixed costs are $305,000. The contribution margin per unit is $40. The BREAK-EVEN point in unit sales is ______. Multiple choice question. 7,625 12,725 5,100

7,625 Units $305,000 / $40 = 7,625 Units

A company's selling price is $90 per unit, variable cost per unit is $28 and total fixed expenses are $320,000. The number of unit sales needed to earn a target profit of $200,800 is ______. Multiple choice question. 18,600 8,400 5,162 5,787

8,400 units Reason: ($320,000 + $200,800) ÷ ($90 - $28) = 8,400 units

The measure of how a percentage change in sales affects profits at any given level of sales is the ______. Multiple choice question. degree of operating leverage margin of safety contribution margin ratio

degree of operating leverage

Once the break-even point is reached, the sale of an additional unit increases contribution margin by an amount that is ______ the increase in net operating income. Multiple choice question. less than greater than equal to

equal to

A company has reached its break-even point when the contribution margin __________ fixed expenses.

equals

An activity cost pool accumulates costs for ______ activity measure(s). Multiple choice question. one or more multiple exactly one

exactly one

If some products are overcosted and some are undercosted the errors will ______. Multiple choice question. cause cost of goods sold to be either overstated or understated cause inventory valuations to be incorrect offset each other in cost of goods sold and inventory valuations

offset each other in cost of goods sold and inventory valuations

Usually, traditional costing ______ high-volume products and ______ low-volume products. Multiple choice question. undercosts; overcosts overcosts; undercosts overcosts; overcosts undercosts; undercosts

overcosts; undercosts

Usually, traditional costing ______ high-volume products and ______ low-volume products. Multiple choice question. undercosts; undercosts overcosts; overcosts overcosts; undercosts undercosts; overcosts

overcosts; undercosts

The final step in implementing ABC is ______. Multiple choice question. assign overhead costs to cost objects prepare management reports calculate activity rates

prepare management reports

The final step in implementing ABC is ______. Multiple choice question. calculate activity rates prepare management reports assign overhead costs to cost objects

prepare management reports

Unit-level activities are ______. Multiple choice question. performed for each group of units related to specific products produced proportional to the number of units produced performed for specific customers

proportional to the number of units produced

The equation used to calculate the variable expense ratio using total values is total variable expenses divided by total ______. Multiple choice question. net income contribution margin fixed expenses sales

sales

The variable expense ratio is the ratio of variable expense to ______. Multiple choice question. the contribution margin sales fixed expense net operating income

sales

Select all that apply Terry's Trees has reached its break-even point and has a contribution margin ratio of 70%. For each $1 increase in sales ______. Multiple select question. total contribution margin will increase by $0.70 net operating income will increase by $0.30 total contribution margin will increase by $0.30 net operating income will increase by $0.70

total contribution margin will increase by $0.70 net operating income will increase by $0.70

The break-even point is reached when the contribution margin is equal to ______. Multiple choice question. total sales total fixed expenses total variable expenses profit

total fixed expenses

Select all that apply Elle's Elephant Shop sells giant stuffed elephants for $55 each. Each elephant has variable costs of $10 and total fixed costs are $700. If Ellie sells 35 elephants this month, ______. Multiple select question. total variable costs = $350 total costs = $1,250 total sales = $1,925 profits = $875

total variable costs = $350 total sales = $1,925 profits = $875

Select all that apply CVP analysis focuses on how profits are affected by ______. Multiple select question. unit variable cost mix of products sold selling price total fixed costs break-even point sales volume

unit variable cost mix of products sold selling price total fixed costs sales volume

Select all that apply Pete's Putters sells each putter for $125. The variable cost is $60 per putter and fixed costs total $400,000. Based on this information ______. Multiple select question. Pete's Putters is unable to make a profit the contribution margin per putter is $65. lowering variable cost per unit to $45 would result in a contribution margin of $70 per unit the sale of 12,000 putters results in net operating income of $380,000

the contribution margin per putter is $65. the sale of 12,000 putters results in net operating income of $380,000

Select all that apply Organization-sustaining activities include ______. Multiple select question. arranging product shipments to customers preparing annual reports setting up a computer network heating a factory

- preparing annual reports - setting up a computer network - heating a factory

Select all that apply Activity-based costing only charges products for the cost of the capacity used because ______. Multiple select question. assigning costs of unused capacity artificially reduces product cost per unit products are only assigned the costs of resources they actually use it results in a more stable unit product cost

- products are only assigned the costs of resources they actually use - it results in a more stable unit product cost

Spice sells paprika for $9.00 per bottle. Variable cost is $2.43 per bottle and Spice's annual fixed costs are $825,000. The variable expense ratio for paprika is ______. Multiple choice question. 78% 27% 100% 54%

27% reason: Variable expense ratio = $2.43 ÷ $9.00 or 27%.

Activity-based costing uses numerous __________ cost pools.

activity

The contribution margin equals sales minus ______. Multiple choice question. product variable costs only all variable costs period variable costs only all product costs all fixed costs

all variable costs

After reaching the break-even point, a company's net operating income will increase by the __________ __________ per unit for each additional unit sold.

blank 1: contribution blank 2: margin

JVL Enterprises has set a target profit of $126,000. The company sells a single product for $50 per unit. Variable costs are $15 per unit and fixed costs total $98,000. How many units does JVL have to sell to BREAK-EVEN? Multiple choice question. 2,800 3,600 6,400 1,960

2,800 $2,80098,000/(50-15) = 2,800

Blissful Blankets' target profit is $520,000. Each blanket has a contribution margin of $21. Fixed costs are $320,000. The number of blankets Blissful Blankets need to sell in order to achieve its target profit is ______. Multiple choice question. 24,762 40,000 9,524 15,238

40,000 blankets($520,000 + $320,000) / $21 = 40,000 blankets

Operating leverage is a measure of how sensitive ______ is to a given percentage change in sales dollars. Multiple choice question. selling price per unit net operating income total variable expense total gross margin

net operating income

Operating leverage is a measure of how sensitive ______ is to a given percentage change in sales dollars. Multiple choice question. total gross margin selling price per unit total variable expense net operating income

net operating income

Select all that apply Company A has sales of $500,000, variable costs of $350,000, and fixed costs of $150,000. Company A has ______. Multiple select question. reached the break-even point a contribution margin equal to fixed costs earned a net operating profit incurred a net operating loss

- reached the break-even point - a contribution margin equal to fixed costs