Explain the impact of an increase in the level of activity (or cost driver) on (a) total fixed cost and (b) fixed cost per unit of activity.

Q: Which of the following is called minimum point of production at which total cost is recovered:…

A: The margin of safety sales is calculated as difference between current sales and break even sales.

Q: What is the effect of an increase in activity on the following items? a. Total variable costs b.…

A: a) An increase in activity would increase the total variable costs proportionately. Variable cost is…

Q: Fixed cost per unit ______ A

A: Under Marginal costing technique there are two types of costs . That is  a) Fixed costs Fixed cost…

Q: What is the effect of an increase in activity on the followingitems?a. Total variable costs.b.…

A: Cost behavior: Cost behavior is the relationship between cost and activity and it is relevant to the…

Q: QUESTION 12 Raw material and direct labor costs are examples of ____.   a. fixed costs   b.…

A: Raw material and direct labor costs are used directly for the production and operation. So as it is…

Q: Which costs will change with a decrease in activity within the relevant range? Unit variable cost…

A: Cost can be classified into two categories i.e fixed cost and variable cost. The fixed cost remains…

Q: Which one of the following depends on the level of output or activity? O building rent cost O…

A: Note: We’ll answer the first question since the exact one wasn’t specified. Please submit a new…

Q: Define and explain the contribution margin.  Include the difference in fixed and variable costs in…

A: Contribution margin may be defined as the amount of profit generated when only the cost of goods…

Q: In applying the high-low method of cost estimation to mixed costs, how is the total fixed cost…

A: Mixed cost also called the semi variable cost . Mixed cost contains both fixed and variable cost .…

Q: a. What problems are associated with using the average cost per unit as a performance measure? b.…

A: Average cost per unit only rewards the manager for removing tasks or materials from the process…

Q: A total cost equation can be used to predict future costs for various activity levels. Write the…

A: Concept The total cost is the sum of variable cost and fixed cost incurred For example if variable…

Q: The amount of increase or decrease in cost that is expected from a particular course of action as…

A: Discretionary cost: A discretionary expense is a cost that a business or household can survive…

Q: Compute the Revenue Effect- Growth Component, indicate if favorable/(unfavorable). *The activity…

A: Revenue refers to the amount received by the company from selling goods and services to the…

Q: What is the effect of an increase in activity on total variable costs,variable cost per unit of…

A: Total cost refers to the cost or amount incurred by the company in production of its goods and…

Q: What are the challenges of using the incremental cost allocation method when allocating common costs…

A: Cost Allocation Method:   The cost allocation method is the method by which the costs to be assigned…

Q: costs that change proportionately according to the changes in the cost driver.......

A: variable costs are the costs that change according to the changes in the cost drivers or changes…

Q: Explain the effect of a decrease in the level of activity (cost driver) on: (i) total fixed cost…

A: Lets understand the basics. Fixed cost are cost which do not change with level of output. In other…

Q: A variable cost is a cost thata. varies per unit at every level of activity.b. occurs at various…

A: The cost can be classified into two categories i.e fixed cost and variable cost. The  FIxed cost…

Q: What effect does an increase in volume have on—c. Total fixed costs?

A:

Q: A fixed cost is a cost which O A. remains constant per unit with changes in the level of activity O…

A: Fixed cost is not affected by the changes in the level of activity.

Q: Which one of the following activity shows semi-variable cost behaviour A. Unit level activity B.…

A: A semi-variable cost, also known as a semi-fixed cost or a mixed cost, is a cost composed of a…

Q: a. Define and explain contribution margin on a per unit basis.

A: Contribution margin is the amount of sales revenue over and above it's variable costs in the…

Q: The “fixed cost per unit function” may also be described as: a.an asymptote b.the total cost line…

A: Introduction:- Fixed costs, also known as indirect costs or overhead costs, are corporate expenses…

Q: When output volume increases, do fixed costs per unit increase, decrease, or stay the same within…

A: Fixed Costs:   These are the costs that remain constant in total dollar amount irrespective to the…

Q: A cost which changes in proportion to changes in volume of activity is called a: *       a. fixed…

A: Costs are the expenses or amounts incurred in the business for manufacturing or selling of products.…

Q: A changes in direct proportion to changes in the cost-driver level * mixed costs O fixed costs O…

A: If the change in cost and change cost driver level is of direct proportion, it is not fixed cost or…

Q: Describe how total variable costs and unit variable costs behave as the level of activity increases?

A: Variable cost varies with the changing level of activity i.e. if the activity increases the variable…

Q: How does the length of the time horizon affect the classification of a cost as fixed or variable?…

A: Cost are being classified as variable and fixed normally. It is necessary to bifurcate the cost in…

Q: What effect does an increase in volume have on—a. Unit fixed costs?

A: Fixed costs are those costs of business which remain fixed in total irrespective of change in volume…

Q: Variable Costs are costs that change in direct proportion to changes in activity level. (b) Unit…

A: Variable costs: These are the costs that vary depending on the volume of the activity. Fixed costs:…

Q: Describe how total fixed costs and unit fixed costs behave as the level of activity increases

A: Fixed costs are those costs that remain fixed irrespective of the level of activity.

Q: Which of the following describes the behavior of total variable and total fixed costs when level of…

A: Different costs associated with production process are - Fixed cost and variable cost. For example:…

Q: Explain the impact of an increase in the level of activity (or cost driver) on (a) total variable…

A: (a)

Q: Fixed costs are costs that: Select one: a. Neither of the above b. remain the same per unit at every…

A: Fixed Cost Correct Answer = Option B = Remain the same per unit at every activity level Variable…

Q: Variable costs are costs that: Select one: a. Both (a) and (b) above. b. vary in total directly and…

A: The costs incurred in production can be classified as variable cost, fixed cost and mixed cost.

Q: The high-low method: a. Calculates variable costs per unit by dividing the difference in the high…

A: The high-low method is a method to separate or segregate the fixed and variable cost portions of a…

Q: Which of the following statements describes variable costs?A. Costs that vary on a per-unit basis as…

A: The financial position of the company can be arrived from the income statement prepared by the…

Q: What is the main difference between activity-based costing and the theory of constraints? When is…

A: Costing: Costing is a technique used in cost accounting to determine the cost of a product. With…

Q: Fixed costs per unit . Can be estimated by the high-low method. O Remains the same when the level of…

A: The monetary value paid for the acquisition of something, or to run the operations of the…

Q: Explain the concept of relevant range and

A: Fixed costs refer to the expenses that do not increase or decline with changes in the company's…

Q: How does the fixed cost per unit change as the level of activity (or cost driver) increases? Why?

A: Fixed cost refers to such overheads that are not directly related to the business and which do not…

Q: What effect does an increase in the activity level have on— a. Unit fixed costs? b. Unit variable…

A:

Q: A fixed cost remains constant in total and on a per unit basis at various levels of activity. Ture O…

A: Following is the answer to the given question