ssume there is a reduction in the selling price and all other CVP parameters remain constant. This change will: increase contribution margin reduce operating income O reduce fixed costs increase variable costs

ssume there is a reduction in the selling price and all other CVP parameters remain constant. This change will: increase contribution margin reduce operating income O reduce fixed costs increase variable costs

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter3: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 14MC: When fixed costs increase and all other variables remain unchanged, the contribution margin will A....

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Question

Assume there is a reduction in the selling price and all other CVP parameters remain constant. This change will:

increase contribution margin

reduce operating income

O reduce fixed costs

increase variable costs

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Similar questions

When fixed costs decrease and all other variables remain unchanged, the break-even point will _______________. A. remain unchanged B. increase C. decrease D. produce a lower contribution margin
When variable costs increase and all other variables remain unchanged, the break-even point will ____________________. A. remain unchanged B. increase C. decrease D. produce a lower contribution margin
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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
Which of the following statements is true regarding average fixed costs? A. Average fixed costs per unit remain fixed regardless of level of activity. B. Average fixed costs per unit rise as the level of activity rises. C. Average fixed costs per unit fall as the level of activity rises. D. Average fixed costs per unit cannot be determined.
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
If the fixed expenses of a product increase while variable expenses and the selling price remain constant, what will happen to the total contribution margin and the break-even point? Contribution margin Break-even point A. Increase Decrease B. Decrease Increase C. Unchanged Increase D. Unchanged Unchanged Multiple Choice Choice D. Choice A. Choice B. Choice C.
When fixed costs increase and all other variables remain unchanged, the contribution margin will ________. Select one: a. remain unchanged b. decrease c. increase d. increase variable costs per unit
If both the fixed costs associated with a product and the variable costs (as apercentage of sales dollars) decrease, what will be the effect on the contribution margin ratio and the break-even point, respectively?a. Decrease, increase.b. Increase, decrease.c. Decrease, decrease.d. Increase, increase.