University of Louisiana, Lafayette ACCT 526 / ACCT526 Quiz 3

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ACCT526-820_020-201840 Started on Monday, 2 April 2018, 9:11 PM State Finished Completed on Monday, 2 April 2018, 9:14 PM Time taken 3 mins 36 secs Grade 10.00 out of 10.00 (100%) Question 1 Co... rrect Mark 2.00 out of 2.00 Flag question Question text Match each term with its definition. Costs that remain the same in total regardless of changes in the activity level Answer 1 The amount of revenue remaining after deducting variable costs Answer 2 The level of activity at which total revenues equal total costs Answer 3 The range of activity index over which the company expects to operate during the year Answer 4 The study of how specific costs respond to changes in the level of activity Answer 5 Fixed costs Contribution margin Break-even point Relevant range This study source was downloaded by 100000831988016 from CourseHero.com on 03-28-2022 14:53:21 GMT -05:00 https://www.coursehero.com/file/30550772/ACCT-526-Quiz-3docx/ Costs that vary in total directly and proportionately with changes in the activity level Answer 6 Feedback Your answer is correct. The correct answer is: Costs that remain the same in total regardless of changes in the activity level – Fixed costs, The amount of revenue remaining after deducting variable costs – Contribution margin, The level of activity at which total revenues equal total costs – Break-even point, The range of activity index over which the company expects to operate during the year – Relevant range, The study of how specific costs respond to changes in the level of activity – Cost behavior analysis, Costs that vary in total directly and proportionately with changes in the activity level – Variable costs Question 2 Correct Mark 2.00 out of 2.00 Flag question Question text Match each statement with the correct answer The activity level is represented by an activity index such as direct labor hours, units of output, or sales dollars Answer 1 The contribution margin per unit is the unit selling price less the fixed costs per unit Answer 2 The margin of safety is the difference between fixed costs and variable costs Answer 3 A CVP income statement classifies expenses by function rather than by cost behavior Answer 4 For purposes of CVP analysis, mixed costs must be classified into their fixed and variable elements Answer 5 Cost behavior analysis Variable costs True False False False True This study source was downloaded by 100000831988016 from CourseHero.com on 03-28-2022 14:53:21 GMT -05:00 https://www.coursehero.com/file/30550772/ACCT-526-Quiz-3docx/ If the contribution margin ratio is 60% and the amount of fixed costs are $400,000, then the sales dollars at the break-even point are $666,667 Answer 6 Feedback Your answer is correct. The correct answer is: The activity level is represented by an activity index such as direct labor hours, units of output, or sales dollars – True, The contribution margin per unit is the unit selling price less the fixed costs per unit – False, The margin of safety is the difference between fixed costs and variable costs – False, A CVP income statement classifies expenses by function rather than by cost behavior – False, For purposes of CVP analysis, mixed costs must be classified into their fixed and variable elements – True, If the contribution margin ratio is 60% and the amount of fixed costs are $400,000, then the sales dollars at the break-even point are $666,667 – True Question 3 Correct Mark 2.00 out of 2.00 Flag question Question text Fixed costs are costs that: Select one: a. remain the same in total regardless of changes in the activity level b. vary inversely with activity on a per unit basis c. both (a) and (b) d. neither (a) nor (b) Feedback Your answer is correct. The correct answer is: both (a) and (b) Question 4 Correct Mark 2.00 out of 2.00 True This study source was downloaded by 100000831988016 from CourseHero.com on 03-28-2022 14:53:21 GMT -05:00 https://www.coursehero.com/file/30550772/ACCT-526-Quiz-3docx/ Flag question Question text In the Gabbana Company, maintenance costs are a mixed cost. At the low level of activity (40 direct labor hours), maintenance costs are $600. At the high level of activity (100 direct labor hours), maintenance costs are $1,100. Using the high-low method, what is the variable mainten [Show More]

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