All else being equal, a $10.00 increase in a product's variable expense per unit accompanied by a $10.00 increase in its selling price per unit will: Select one: a. have no effect on the contribution margin ratio. b. None of the given answers. c. increase the break-even volume. d. decrease the total contribution margin. e. decrease the degree of operating leverage.

All else being equal, a $10.00 increase in a product's variable expense per unit accompanied by a $10.00 increase in its selling price per unit will: Select one: a. have no effect on the contribution margin ratio. b. None of the given answers. c. increase the break-even volume. d. decrease the total contribution margin. e. decrease the degree of operating leverage.

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter3: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 15MC: If the sales mix in a multi-product environment shifts to a higher volume in low contribution margin...

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Would each of the following increase, decrease, or have an indeterminant effect on a firms break-even point (unit sales)? a. The sales price increases with no change in unit costs. b. An increase in fixed costs is accompanied by a decrease in variable costs. c. Variable labor costs decline; other things are held constant.
If the sales mix in a multi-product environment shifts to a higher volume in low contribution margin products, the break-even point will ____________________________________ . A. remain unchanged because all products are included in the calculation of break-even B. increase because the low contribution margin products have little effect on break-even C. increase because the per composite unit contribution margin will decrease D. decrease because the per composite unit contribution margin will increase
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When sales price increases and all other variables are held constant, the break-even point will A. remain unchanged _________________________. B. increase C. decrease D. produce a lower contribution margin
When sales price decreases and all other variables are held constant, the break-even point will _______________________. A. remain unchanged B. increase C. decrease D. produce a higher contribution margin
All else being equal, a $10.00 increase in a product's variable expense per unit accompanied by a $10.00 increase in its selling price per unit will: Select one: O a. have no effect on the total contribution margin. b. have no effect on the contribution margin ratio. O c. None of the given answers. O d. increase the break-even volume. O e decrease the degree of operating leverage.
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