Principles of Accounting Volume 2
19th Edition
ISBN: 9781947172609
Author: OpenStax
Publisher: OpenStax College
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Textbook Question
Chapter 3, Problem 11MC
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
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When sales price increases and all other variables are held constant, the break-even point will ________.A. remain unchangedB. increaseC. decreaseD. produce a lower contribution margin
If sales volume increases and all other factors remain constant, then the:
O contribution margin ratio will increase.
O margin of safety will increase.
break-even point will decrease.
O net operating income will decrease.
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.
Chapter 3 Solutions
Principles of Accounting Volume 2
Ch. 3 - The amount of a units sales price that helps to...Ch. 3 - A companys product sells for $150 and has variable...Ch. 3 - A companys product sells for $150 and has variable...Ch. 3 - A companys contribution margin per unit is $25. It...Ch. 3 - A company sells its products for $80 per unit and...Ch. 3 - If a company has fixed costs of $6.000 per month...Ch. 3 - Company A wants to earn $5,000 profit in the month...Ch. 3 - A company has wants to earn an income of $60,000...Ch. 3 - A company has pre-tax or operating income of...Ch. 3 - When sales price increases and all other variables...
Ch. 3 - When sales price decreases and all other variables...Ch. 3 - When variable costs increase and all other...Ch. 3 - When fixed costs decrease and all other variables...Ch. 3 - When fixed costs increase and all other variables...Ch. 3 - If the sales mix in a multi-product environment...Ch. 3 - Break-even for a multiple product firm. can be...Ch. 3 - Waskowski Company sells three products (A. B. and...Ch. 3 - Beaucheau Farms sells three products (E, F, and G)...Ch. 3 - A company sells two products, Model 101 and Model...Ch. 3 - Wallace Industries has total contribution margin...Ch. 3 - Macom Manufacturing has total contribution margin...Ch. 3 - If a firm has a contribution margin of $59,690 and...Ch. 3 - If a firm has a contribution margin of $78M90 and...Ch. 3 - Define and explain contribution margin on a per...Ch. 3 - Define and explain contribution margin ratio.Ch. 3 - Explain how a contribution margin income statement...Ch. 3 - In a cost-volume-profit analysis, explain what...Ch. 3 - What is meant by a products contribution margin...Ch. 3 - Explain how a manager can use CVP analysis to make...Ch. 3 - After conducting a CVP analysis, most businesses...Ch. 3 - Explain how for is possible for costs to change...Ch. 3 - Explain what a sales mix is and how changes in the...Ch. 3 - Explain how break-even analysis for a...Ch. 3 - Explain margin of safety and why it is an...Ch. 3 - Define operating leverage and explain its...Ch. 3 - Calculate the per-unit contribution margin of a...Ch. 3 - Calculate the per-unit contribution margin of a...Ch. 3 - A product has a sales price of $150 and a per-unit...Ch. 3 - A product has a sales price of $250 and a per-unit...Ch. 3 - Maple Enterprises sells a single product with a...Ch. 3 - Marlin Motors sells a single product with a...Ch. 3 - Flanders Manufacturing is considering purchasing a...Ch. 3 - Marchete Company produces a single product. They...Ch. 3 - Brahma Industries sells vinyl replacement windows...Ch. 3 - Salvador Manufacturing builds and sells...Ch. 3 - Salvador Manufacturing builds and sells...Ch. 3 - Use the information from the previous exercises...Ch. 3 - Company A has current sales of $10,000,000 and a...Ch. 3 - Marshall s target margin of safety be in units and...Ch. 3 - Calculate the per-unit contribution margin of a...Ch. 3 - Calculate the per-unit contribution margin of a...Ch. 3 - A product has a sales price of $175 and a per-unit...Ch. 3 - A product has a sales price of $90 and a per-unit...Ch. 3 - Cadre, Inc., sells a single product with a selling...Ch. 3 - Kerr Manufacturing sells a single product with a...Ch. 3 - Delta Co. sells a product for $150 per unit. The...Ch. 3 - Shonda & Shonda is a company that does land...Ch. 3 - Baghdad Company produces a single product. They...Ch. 3 - Keleher Industries manufactures pet doors and...Ch. 3 - Manufacturing builds and sells switch harnesses...Ch. 3 - Manufacturing builds and sells switch harnesses...Ch. 3 - Use the information from the previous exercises...Ch. 3 - Company A has current sales of $4,000,000 and a...Ch. 3 - Best Wholesale recently calculated their...Ch. 3 - A company sells small motors as a component part...Ch. 3 - A company manufactures and sells racing bicycles...Ch. 3 - Fill in the missing amounts for the four...Ch. 3 - Markham Farms reports the following contribution...Ch. 3 - Kylies Cookies is considering the purchase of a...Ch. 3 - Morris Industries manufactures and sells three...Ch. 3 - Manatoah Manufacturing produces 3 models of window...Ch. 3 - Jakarta Company is a service firm with current...Ch. 3 - A company sells mulch by the cubic yard. Grade A...Ch. 3 - A company manufactures and sells blades that are...Ch. 3 - Fill in the missing amounts for the four...Ch. 3 - West Island distributes a single product. The...Ch. 3 - Wellington, Inc., reports the following...Ch. 3 - Karens Quilts is considering the purchase of a new...Ch. 3 - Abilene Industries manufactures and sells three...Ch. 3 - Tim-Buck-Il rents jet skis at a beach resort....Ch. 3 - Fire Company is a service firm with current...Ch. 3 - Mariana Manufacturing and Bellow Brothers compete...Ch. 3 - Roald is the sales manager for a small regional...Ch. 3 - As a manager, you have to choose between two...Ch. 3 - Coutures Creations is considering offering Joe, an...
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- 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 marginarrow_forwardWhen 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 marginarrow_forwardWould each of the following increase, decrease, or have an indeterminant effect on a firms break-even point (unit sales)? a. The sales price increases with no change in unit costs. b. An increase in fixed costs is accompanied by a decrease in variable costs. c. Variable labor costs decline; other things are held constant.arrow_forward
- 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 increasearrow_forwardWhen 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 unitarrow_forwardWhen should a segment be dropped? A. only when the decrease in total contribution margin is less than the decrease in fixed cost B. only when the decrease in total contribution margin is equal to fixed cost C. only when the increase in total contribution margin is more than the decrease in fixed cost D. only when the decrease in total contribution margin is less than the decrease in variable costarrow_forward
- If sales volume decreases and all other factors remain constant, then the Multiple Choice margin of safety will increase. break-even point will decrease. contribution margin ratio will increase. net operating income will decreasearrow_forwardIf 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.arrow_forwardThe breakeven point increases if : a the variable cost per unit decreases O b . the contribution margin per unit increase O c . the total fixed costs decrease O d none of the given answers O e . the selling price per unit decreasesarrow_forward
- 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 costsarrow_forwardThe breakeven point decreases if: a. the variable cost per unit increases b. the contribution margin per unit decreases c.none of the given answers d. the selling price per unit increases . e. the total fixed costs increasearrow_forwardThe breakeven point decreases if a. the selling price per unit decreases b. the contribution margin unit increases c. none of the given answers d. the total fixed costs increase e. the variable cost per unit increasesarrow_forward
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