Question :
88.Lawn Cut Perfection provided data concerning the costs incurred to : 1302727
88.Lawn Cut Perfection provided data concerning the costs incurred to mow residential lawns for which customers pay $45 per mowing. Data for the past 7 months are as follows:
JanuaryFebruaryMarchAprilMayJuneJuly
Number of lawns mowed200110150100220120210
Mowing cost$12,900$8,120$10,200$8,200$13,060$8,400$13,280
How much are the estimated monthly fixed costs using the high-low method?
A.$8,200
B.$2,444
C.$4,150
D.$3,180
89.What are the three elements of the profit equation?
A.Selling price per unit, variable cost per unit, and fixed cost per unit
B.Total revenues, total variable costs, and total fixed cost
C.Selling price per unit, variable cost per unit, and total fixed costs
D.Selling price per unit, total variable costs, and fixed cost per unit
90.What must be true if the contribution margin is less than zero?
A.The selling price per unit is less than the variable cost per unit
B.Total fixed costs will be greater than total variable costs.
C.Not enough units were sold.
D.Fixed costs plus variable costs are less than total revenue.
91.Which of the following assumptions might negatively affect the validity of a CVP analysis?
A.Costs can be accurately separated into fixed and variable components.
B.Fixed costs remain fixed, and variable costs per unit do not change over the activity levels of interest.
C.Both the assumptions—costs can be accurately separated into fixed and variable components, and fixed costs remain fixed, and variable costs per unit do not change over the activity levels of interest—negatively affect the validity of a CVP analysis.
D.None of these answer choices are correct.
92.Which of the following is not considered to be a ‘cost’ in cost-volume-profit analysis?
A.Variable costs
B.Fixed costs
C.Opportunity costs
D.Mixed costs
93.Which of the following statements is correct?
A.Total fixed costs are equal to revenue plus variable cost per unit times the quantity produced.
B.Profit is equal to total fixed costs plus revenue.
C.Total fixed costs are equal to profit minus revenue.
D.Profit is equal to revenue minus total variable costs minus total fixed costs.
94.Which of the following will have no effect on the break-even point in units?
A.The selling price increases.
B.The variable cost per unit increases.
C.The number of units sold declines.
D.Total fixed costs increase.
95.Hanalei Fishing Trips is operating at its break-even point of 4,200 fishing trips per year. Which of the following statements is true?
A.The amount of the company’s total costs equals the amount of its revenues.
B.The company’s fixed costs equal its variable costs.
C.The company’s profit is equal to its contribution margin.
D.Assuming no other changes, if the company sold fewer trips, it will earn a higher contribution margin per trip.
96.The margin of safety is the difference between
A.total revenue and total fixed costs.
B.expected level of sales and the break-even point in revenue dollars.
C.expected profit and profit at break-even.
D.selling price and variable cost per unit.
97.IM Enterprises sells two products, Crunchies and Munchies. Crunchies have a 32 percent contribution margin and Munchies have a 35 percent contribution margin. Profit earned from each box of Crunchies is $8 and the profit earned from each box of Munchies is $7. If the company is planning to generate revenue of $100, what should the company do?
A.It should sell more Crunchies.
B.It should sell more Munchies.
C.It should sell an equal number of each product.
D.No recommendation can be made from the data given.
