Why do you think the change in the index of labor cost per unit of output is a useful lagging indicator of the macroeconomy?

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

A: A variable cost changes is directly proportional to the change in the level of activity or cost…

Q: How do the concepts of income and substitution effects enhance our understanding why annual hours…

A: The income effect is the change in the consumption of goods by consumers based on…

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: Which of the following will result in the increasing the break-even point? O A decrease in the…

A: Break-even point = Fixed costs / Contribution per unit Contribution per unit = Selling price per…

Q: Would an increase in variable costs per unit cause a company’s break-even point to increase or…

A: Variable cost is an amount that changes in total in proportion to the volume produced and sold…

Q: Which of the following describes the behavior of the fixed cost per unit? Group of answer choices…

A: Fixed cost is defined as the cost independent of the good produced or service rendered in an entity.…

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

A: Variable costs: These are the costs that proportionately change with the changes in the activity…

Q: As compared with the FIFO method of costing inventories,does the LIFO method result in a larger or…

A:

Q: How can the WACC be both an average cost and a marginal cost?

A: Weighted average cost of capital is the aggregated cost of capital with respect to the weights or…

Q: What does it mean to use the DuPont model to help explain a decrease in ROI?

A: Introduction: DuPont analysis is done to find out the various drivers that account for the return on…

Q: Can the EOQ model be used when a company faces seasonaldemand fluctuations?

A: Economic Order Quantity (EOQ) is one of the models in inventory management which is used to minimise…

Q: Is this statement true or false? Can you please explain in detail. There is a difference between…

A: Firstly let us understand what is the theoretical production capacity is the optimum production…

Q: why does fixed costs remain the same in total dollar amount but increases per unit as the level of…

A: Fixed costs means those costs which remain fixed in total dollar amount as the level of activity…

Q: Why is there typically a rise in ROI or residual income across time in a division? What undesirable…

A: Return on investment (ROI):   This financial ratio evaluates how efficiently the assets are used in…

Q: Why is the basic earning power ratio useful?

A: Basic earning power ratio shows the relationship between earnings before interest and taxes and…

Q: Which of the following statements is true? a. Both variable and fixed cost change with the change in…

A: Variable cost- It is a cost which varies when the production level of the entity changes. There is a…

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

A: Cost Accounting: It is the process of collecting, recording, analyzing the cost, summarizing cost,…

Q: How does Lean Production reduce or eliminate the difference in reported net operating income between…

A: Absorption Costing: Absorption costing is a method for calculating the full cost or total cost of a…

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: Which of the following statements is CORRECT with respect to fixed costs per unit? Select one:…

A: Fixed cost in total remains constant.  They will not change by change in production.

Q: Why is an incremental analysis necessary when conducting a rate of return analysis for cost…

A: Incremental analysis considers only the relevant cash flows and it does not consider the…

Q: What does it mean when ROI has decreased even though net income hasincreased?

A: Return on investment (ROI): This financial ratio evaluates how efficiently the assets are used in…

Q: Which of the following is true of a variable cost? Total variable cost remains constant with…

A: Variable cost: It a cost that changes in total as a response to change in one or more cost drivers,…

Q: What is the difference between an accounting break-even and a break-even NPV? Which will offer the…

A: Break-even point = Total Fixed Costs / Contribution margin per unit   Break-even ratio = Annually…

Q: Which of the following cost behavior assumptions is false? * a. Variable costs are constant if…

A: Solution: Cost behavior assumptions that is false is "Total fixed costs decrease as the level of…

Q: Which tool can be used to easily calculate the change in profit resulting from a change in sales…

A: Cost-volume-profit analysis: Cost-Volume-Profit Analysis (CVP analysis), also commonly referred to…

Q: In what sense is the WACC an average cost? A marginal cost?

A: Weighted average cost of capital is the firm's cost of capital which is based on proportion of each…

Q: Which one of the following is NOT a correct definition of Gross Domestic Product (GDP)? (a) GDP is…

A: GDP: Gross domestic product is the total monetary or market value of all the finished goods and…

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: A company's break-even point will  not be changed by:

A: Break-even point i Break-even point is a level of activity where no profit is gained and no loss…

Q: Suppose that there is a constant technological progress (A) and population growth (n) in a sample…

A: The technical process is technology's work technique, and it consists of an organized series of…

Q: What happens to the total variable costs and the total fixed costs when the level of activity…

A: Formula: Total cost = Variable cost + Fixed cost Sum of both variable and fixed cost derives the…

Q: In cost-volume-profit analysis, what is the estimated profit at the break-even point?

A: Cost volume profit analysis is useful to find out the different sales volume on the basis of…

Q: What is happening to average costs when marginal cost is greater than average cost at a specific…

A: When marginal cost is greater than average cost (including average variable cost or average total…

Q: Discuss the advantage and disadvantage of level production schedules in firms with cyclical sales.

A: Level Production schedule is or can be very important in the manufacturing industry. Sometimes it…

Q: In the fixed cost per unit does the it increase as activity decreases and will decrease as activity…

A: Variable cost means the cost which vary with the level of output and fixed cost means the cost which…

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: Which of the following is not an assumption underlying cost-volume-profit analysis?

A: Cost Volume Profit analysis- This analysis helps in understanding the cost and profit based on the…

Q: Which of the following do not increase or decrease when the volume of production changes? O a. Fixed…

A: Some cost do not get affected by the volume of production. It remains same at all the levels of…

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…