Question 18 What kind of effect on fixed costs per unit do changes in activity h

Question

Question 18

What kind of effect on fixed costs per unit do changes in activity have?

a. Positive

b. Negative

c. Inverse

d. Neutral

Question 19

A division sold 200,000 calculators during 2017:

Sales $2,000,000
Variable costs:
Materials $380,000
Order processing 150,000
Billing labor 110,000
Selling expenses 60,000
Total variable costs 700,000
Fixed costs 1,000,000

How much is the unit contribution margin?

a. $1.00

b. $3.50

c. $6.50

d. $8.50

Question 20

Which of the following is an implausible explanation of why variable costs often behave in a curvilinear fashion?

a. Labor specialization

b. Overtime wages

c. Total variable costs are constant within the relevant range

d. Availability of quantity discounts

Question 21

Which of the following would be the least controllable fixed costs?

a. Property taxes

b. Rent

c. Research and development

d. Management training programs

a. Positive

b. Negative

c. Inverse

d. Neutral

Explanation / Answer

18 positive. because as their should be changes in the activity their may be a incresae in the production which led to decrase in the per unit fixed cost

19 sales per unit=2000000/200000=10

variable cost per unit =700000/200000=3.5

contribution margin per unit = sales per unit - variable cost per unit

=10-3.5

=6.5

19 total variable costs are constant within the relevant range because it's not true because variable cost is never be constant

20 property taxes because they are compulsary to pay

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