A100 Checkpoint 5
Roosevelt Inc. breaks even when it sells 1,600 units. The company's variable cost per unit is $10 and the selling price is $25 per unit. The total fixed cost are $24,000 & the contribution margin is $24,000. How many units does Roosevelt need to sell to earn $40,000 in net income? A 4,267 B 3,200 C 1,760 D 3,600
A 4,267
The usual starting point for a master budget is: A the budgeted income statement. B the sales forecast or sales budget. C the direct materials purchase budget. D the production budget.
B the sales forecast or sales budget.
Which of the following is true? A Fixed costs per unit always stay the same. B Total fixed costs plus total variable costs will always equal total sales. C The contribution margin will always equal fixed costs plus net income. D Variable costs per unit will vary depending on the level of production.
C The contribution margin will always equal fixed costs plus net income.
A $3.00 increase in a product's variable expense per unit accompanied by a $3.00 increase in its selling price per unit will: A decrease the contribution margin. B have no effect on the contribution margin ratio. C have no effect on the break-even volume. D none of these answers are correct.
C have no effect on the break-even volume.
Which of the following costs are always irrelevant in decision making? A fixed costs B opportunity costs C avoidable costs D sunk costs
D sunk costs
