Your team is conducting a CVP analysis for a new product. Different sales projections have different incomes. One member suggests picking numbers yielding favorable income because any estimate is “as good as any other.” Another member suggests dropping unfavorable data points for cost estimation. What do you do?

Q: Which of the following is not one of the benefits of breakeven analysis to businesses? A.…

A: A break-even analysis is a financial tool

Q: Which of the following is false regarding activity-based costing (ABC)?      a. Companies that have…

A: Activity based costing is a type and method of costing methodology, in which all indirect costs or…

Q: The advantages of calculating Contribution Margins of a company’s products seem to be overwhelming…

A: These are the tools of cost accounting.

Q: Which of the following could not be the explanation for a FAVOURABLE labour efficiency variance in…

A: Labor efficiency can be measured directly through unit produced per hour.

Q: Which of the following is NOT a use of CVP (Cost-Volume-Profit) analysis? a.what is the impact on…

A: SOLUTION- CVP ANALYSIS IS USED TO DETERMINE HOW CHANGES IN COSTS AND VOLUME EFFECTS A COMPANY'S…

Q: hat way can the use of ROI as a performance measure for investment centers lead to bad decisions?…

A: ROI is the return on investment in which the there is consideration for the current year profit only…

Q: A growing firm is contemplating switching from a FIFO to a LIFO cost flow assumption forinventories…

A: In case of rising prices, when the LIFO is applied the cost of goods sold will increase (as the…

Q: When deciding whether to sell as is or process a product further, managers should ignore which of…

A:

Q: Some consulting organizations persuasively argue that by properly incorporating suppliers into their…

A: e relationship of buyer-seller is the bond betweenn the buyer of a product and a seller.

Q: Faced with a long-run make-or-buy decision, the manager should do all of the following except: a.…

A: Ans. While considering a make - or- buy decision a manager is expected to do a lots of study and…

Q: Which of the following is not an underlying assumption of a conventional CVP analysis? Multiple…

A: Cost-volume-profit analysis is the most important tool that is used by managers to specify the cost…

Q: If a company is a multiproduct firm. a. can only utilize CVP analysis if the contribution margin…

A: c)  a multiproduct firm can earn a lower than expected profit though the total number of units sold…

Q: There is often more than one way to improve a performance measure. Unfortunately, some of the…

A:

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: When performing sales mix analysis, which one of the following is true: O a. The sales mix is…

A: The sales mix is a formula that specifies how much of each product a company sells in relation to…

Q: Which of the following statements is true regarding regression analysis?   Question 8 options:…

A: Solution: Following statement are incorrect: 1. Regression analysis considers all of the data points…

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: We can get a sense of how model output responds to changes in inputs from sensitivity analyses. Some…

A: Sensitivity analysis is used to find out the change in input of one value lead to change in the…

Q: Which of the following statements about CVP analysis is false? a. Operating income calculations in…

A: The answer for the multiple choice question and relevant explanation are presented hereunder :

Q: Distinguish how SFS could use Target Costing and Kaizen Costing to improve its future performance.…

A: Target Costing and Kaizen Costing to improve its future performance by the following manner –…

Q: When performing sales mix analysis, which one of the following is false: Oa. Producing and selling…

A: Breakeven sales is that point of sales revenue at which business is covering its fixed costs and…

Q: In what way can the use of ROI as a performance measure for investment centers lead to bad…

A: ROI:   It is a measure on the amount of return on a particular investment with respect to the…

Q: Consider a company faced with a​ competitor's price reduction. Should the company also reduce price…

A:

Q: Which of the following statements is not true regarding the use of variable and absorption costing…

A: Absorption costing: It refers to the method of product costing in which the price of the product is…

Q: With the aid of computer software, managers can vary assumptions regarding selling prices, costs,…

A: Sensitivity analysis is a type of financial model that estimates or determines how output is changed…

Q: Company XYZ produces and sells two types of calculators : Basic and Scientific The Basic has a lower…

A: Contribution = sales -  variable cost

Q: As a manager, you have to choose between two options for new production equipment. Machine A will…

A:

Q: When performing sales mix analysis, which one of the :following is true .a .The sales mix is usually…

A: Break even point = Fixed costs / Weighted average contribution margin

Q: From the standpoint of cost control, why is the FIFO method superior to the weighted-averagemethod?…

A: FIFO method is First in First out method in which inventory which is purchased first will be sold…

Q: A Wall Street Journal article noted that Apple reportedhigher income than its competitors by using a…

A:

Q: Determine which one of the following statements is correct: O a. Achange in the sales mix will…

A: The breakeven point is the point where a company does not have any profit and loss from their sales,…

Q: Budgets are useful only for small companies that can estimate sales with accuracy. Do you agree with…

A: Budget- it is the forecast of revenue of revenue and expenses over a specified future period.…

Q: How may using ROI as a success indicator for investment centers lead to poor decisions? How does the…

A: ROI: It calculates the amount of return on a particular investment about the investment's cost. The…

Q: Berwin Inc. is a small industrial equipment manufacturer with approximately $3.5 million in annual…

A: Introduction: Return on investment (ROI) or return on costs (ROC) is the ratio of net income to…

Q: The best measure for evaluating the effectiveness of a manger in an investment center would be   A.…

A: Responsibility Center is division of organization into different center with each center responsible…

Q: When performing sales mix analysis, which one of the following is true: a. Producing and selling…

A: Sales mix is the ratio in which different products are sold in the company. Contribution margin is…

Q: Which of the following statements concerning performance evaluation tools used in decentralized…

A: Performance evaluation means when actual performance is being compared with the budgeted numbers and…

Q: CVP analysis indicates that your start-up will break even with the current sales mix and price…

A: CVP stands for Cost Volume profit analysis is the one which is used for determining how the changes…

Q: Help question 30

A: The contribution margin ratio shows the percentage of each dollar sales that is available for…

Q: When performing sales mix analysis, which one of the following is false: O a. Normally the…

A: Cost-Volume-Profit (CVP) Analysis: It is a method followed to analyze the relationship between the…

Pricing

Pricing is used as a term in finance and economics, pricing is the process of fixing a value for a product or a service. Pricing establishes a value for a product or service that the customer has to pay. A business can choose from different strategies while deciding to set prices.