When should a segment be dropped?
Q: When should a segment be dropped? only when the decrease in total contribution margin is less…
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Q: Management is considering a one-time-only special order. There is sufficient idle capacity to fill…
A: Introduction:- Management (or management) is the administration of a company, whether for-profit,…
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A: A break-even point means where contribution margin of a company is equal to its Fixed Cost.
Q: The increase/decrease in variable cost from existing level to the new level is called as __cost. a.…
A: Variable cost tends to increase or decrease with increased or decreased volume of production whereas…
Q: Special order, opportunity cost. In order to determine whether a special order should be accepted at…
A: Opportunity Cost:Opportunity cost is total of potential income and other benefits that are lost due…
Q: . What is the difference between variable and fixed costs? Also explain how the total variable cost…
A: " Since you have posted more than two questions and not specified which should be solved so we are…
Q: All else being equal, what happens to the unit contribution margin and the contribution margin ratio…
A: Contribution Margin = Sales per unit - Variable cost per unit
Q: Which of the following statements is NOT true about costs per unit within the relevant range?…
A: Fixed cost is the cost that remains the same at all levels of output. Whereas, variable cost varies…
Q: 21. If variable selling and administrative costs increased, how would the gross margin and…
A: Variable selling and administrative costs are those selling and admin costs which will be changed…
Q: When variable costs increase and all other variables remain unchanged, the break-even point will:…
A: Variable Cost refers to those Cost which are Variable on nature that means they are changed with the…
Q: When fixed costs increase and all other variables remain unchanged, the contribution margin will…
A: The contribution margin seems to be the sum of sales income that surpasses variable expenses. In…
Q: If the fixed expenses of a product increase while variable expenses and the selling price remain…
A: Break even point is the point at which the original cost equals the market price. It is where…
Q: When variable costs increase and all other variables remain unchanged, the break-even point will…
A: The break even point is incurred when all the costs are covered by the sales and there is no profit…
Q: To increase margin of safety, the following measures can be taken O a. Increase the output O b.…
A: The margin of safety is the excess of current sales over break even sales.
Q: If fixed costs related to a product increase, while variable costs and sales ?price remain constant,…
A: Breakeven point is that point of sales revenue at which business is covering its fixed costs and…
Q: When deciding whether we should add or drop a product or segment, we should think about Multiple…
A: When deciding whether we should add or drop a product or segment, we should think about : the…
Q: Within the relevant range, if there is a change in the level of the cos a. Total fixed costs and…
A: Fixed cost will change and total cost will remain the same.
Q: when the contribution margin ratio increases
A: Option A is wrong because break-even point decreases when the contribution margin ratio increases.…
Q: Select the correct statement regarding fixed costs. They do not change, because fixed costs should…
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Q: Cost-Capacity calculation technique takes into account a constant exponent to relate different costs…
A: Sensitivity analysis is financial analysis that determine The potential percent gain or loss in…
Q: Advocates of variable costing argue that * a. fixed production costs should be added to…
A: The fixed costs are those costs which are constant on total basis and per unit of cost decreases as…
Q: Which of the following would lead to the breakeven point of a product shifting to the left on a…
A: Break-even analysis is done in order to find out at what point the total cost will be equal to the…
Q: In making a short-term special decision, which of the following is MOST important? a. Use a…
A: Solution Concept The decision that is to be taken differs from one another on the basis of the time…
Q: Special order, opportunity cost. In order to determine whether a special order should be accepted at…
A: Opprtunity cost should be consider while accepting special order. As order is received at full…
Q: At the breakeven point Select one: a. Fixed costs will be equal to variable costs b. Sales will be…
A: Sales revenue: It is the revenue earned by a business on selling the goods or providing services to…
Q: 1. The most likely strategy to reduce the break-even point would be to a. Increase both the fixed…
A: A Break-even point is a point at which a company is able to cover all its expenses with the present…
Q: decrease in variable cost
A: Break even point is the level of sales at which an entity begins to generate profit. Break even…
Q: Which of the following statements is CORRECT with respect to fixed costs per unit? Select one: A.…
A: Fixed costs are those costs which do not change with change in level of activity. For example,…
Q: Relevant of differential cost analysis takes all variable and fixed costs into account to analyze…
A: Differential cost analysis is the difference in cost for every alternative which helps in making the…
Q: Which one of the following statements is correct? O a. Avariable cost is a cost whose cost per unit…
A: The cost can be classified into two categories i.e fixed cost and variable cost. The FIxed cost…
Q: When the level of activity increases, total fixed costs a. decrease. b. remain the same. c.…
A: Costing: Costing is a technique used in cost accounting to determine the cost of a product. With…
Q: The effect on contribution margin ratio (CMR) and BEP of increasing sales price assuming it will not…
A: Introduction:- Discussion of the effect on contribution margin ratio (CMR) and BEP of increasing…
Q: When variable costs increase and all other variables remain unchanged, the break-even point will…
A: Break even point is that point at which business is recovering its fixed costs and variable costs.…
Q: Show how each of these costs will behave as the volume of activity decreases.…
A: The volume of activity directly impacts the variable cost because the variable cost changes directly…
Q: When using a variable costing system, the contribution margin discloses the excess of Revenues over…
A: Contribution margin = Total revenue - Total variable cost
Q: :Total Fixed costs the level of activity none of the given is correct .a increases with .b does not…
A: The total cost of a product can be variable or fixed cost.
Q: Which of the following occurs if a company experiences a decrease in its fixed costs? Select one: a.…
A: Break-even point: In the accounting term break-even point is a condition where the income or profit…
Q: On the costvolume - profit graph which of the following would result into a decrease in the…
A: Answer
Q: All else being equal , what happens to the unit contribution margin and the contribution margin…
A: Contribution Margin: The process or theory which is used to judge the benefit given by each unit of…
Q: In order to draw a basic break-even chart, which of the following information would you not require?…
A: The break even sales are the sales where business earns no profit no loss during the period. The…
Q: Accepting a special order will improve overall net operating income if the revenue from the special…
A: Variable costs are the costs which change with change in output. Sunk costs are the costs which are…
Q: Which of the following occurs if a company experiences an increase in its fixed costs? Select one: O…
A: Fixed cost indicates the cost which remains constant to a certain level of activity after which the…
Q: What effect does an increase in sales price have on contribution margin? An increase in fixed costs?…
A: Contribution Margin: The process or theory which is used to judge the benefit given by each unit of…
Q: All else being equal, what happens to the unit contribution margin and the contribution margin ratio…
A: Contribution margin is calculated as Sales less variable costs. Sale price is the price at which the…
Q: When variable costs increase and all other variables remain unchanged, the break-even point will: a.…
A: Break even point is that point at which business is recovering its fixed costs and variable costs.…
When should a segment be dropped?
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- 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 marginWhen fixed costs increase and all other variables remain unchanged, the contribution margin will A. remain unchanged _____________________. B. increase C. decrease D. increase variable costs per unitWhich of the following is one of the two approaches used to analyze data in the decision to keep or discontinue a segment? A. comparing contribution margins and fixed costs B. comparing contribution margins and variable costs C. comparing gross margin and variable costs D. comparing total contribution margin under each alternative
- 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.The use of fixed costs to extract higher percentage changes in profits as sales activity changes involves a. margin of safety. b. unit contribution margin. c. degree of operating leverage. d. sensitivity analysis. e. variable cost reduction.When should a segment be dropped? only when the decrease in total contribution margin is less than the decrease in fixed cost only when the decrease in total contribution margin is equal to fixed cost only when the increase in total contribution margin is more than the decrease in fixed only when the decrease in total contribution margin is less than the decrease in variable cost
- The increase/decrease in variable cost from existing level to the new level is called as __cost. a.Standard b.Marginal c.Fixed d.OpportunityWhich of the following is true about the changes in fixed cost? An increase in production will result in an increase in per unit fixed cost. A decrease in fixed cost will result in an increase in variable cost. An increase in production will result in a decrease in per unit fixed cost. A decrease in production will result in an increase in total fixed cost.Which of the following statements is NOT true about costs per unit within the relevant range? Question 7 options: Fixed costs decrease in proportion to increases in volume. Mixed costs decrease but not in direct proportion to increases in volume. Variable costs stay constant with changes in volume. Curvilinear costs stay constant with changes in volume.
- 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 unitIf 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.Which of the following conditions would cause the break-even point to decrease? a. Increase in unit variable cost b. Decrease in unit selling price c. Decrease in unit variable cost d. Increase in total fixed costs
