A company\'s break-even point can be decreased by decreasing: a. the contributio

Question

A company's break-even point can be decreased by decreasing:
       a.   the contribution margin.
       b.   variable costs per unit.
       c.   the selling price.
       d.   the contribution margin ratio.

A production cost report contains sections for:
       a.   units to be accounted for.
       b.   costs accounted for.
       c.   unit costs.
       d.   All of these choices are correct.

Which of the following does not describe a characteristic of process costing?
       a.   Once production begins, it continues until the finished product emerges.
       b.   All units of production receive precisely the same amount of material, labor, and overhead.
       c.   Job cost sheets must pass from one production department to the next on a daily basis.
       d.   Work in process accounts are maintained for each production department.

Which of the following is not an important element of JIT (just in time) processing?
a.   A company must have dependable suppliers who are willing to deliver on short notice exact quantities of raw materials according to precise quality specifications.
       b.   A company must have a multiskilled work force, so that one worker can have the responsibility to operate and maintain several different types of machines.
  c.   A process cost accounting system must be in place.

   d.   A total quality control system must be established throughout the manufacturing operations.

Explanation / Answer

1)

The correct answer is option B.

The decrease in variable cost per unit will lead to decrease in the breakeven point.

If the variable cost per unit increases the break even point increases. Variable cost per unit is directly proportional to the breakeven point.

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