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An activity that adds costs to the product but does not increase its market
value is a
A variable cost is a cost that
1. An increase in the level of activity will have the following effects on
unit costs for variable and fixed costs:
2. A fixed cost is a cost which
3. Hollis Industries produces flash drives for computers, which it sells
for $20 each. Each flash drive costs $14 of variable costs to make.
During April, 1,000 drives were sold. Fixed costs for March were $2 per
unit for a total of $1,000 for the month. How much is the contribution
margin ratio?
4. Contribution margin
5. The equation which reflects a CVP income statement is
6. A company sells a product which has a unit sales price of $5, unit
variable cost of $3 and total fixed costs of $150,000. The number of
units the company must sell to break even is
7. Under absorption costing and variable costing, how are fixed
manufacturing costs treated?
8. Management may be tempted to overproduce when using
9. Only direct materials, direct labor, and variable manufacturing
overhead costs are considered product costs when using
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ACC 561 Week 5 Assignment Case Study CVP, Break-even,
margin of safety (Mary Willis, New Syllabus)
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