When using CVP Analysis, Net Profit (positive NI) would occur when Fixed Costs (FC) exceed total Contribution Margin. TRUE FALSE

Q: RUE OR FALSE Net income under GAAP highlights differences between variable and fixed costs.

A: Answer:   Net income under GAAP highlights differences between variable and fixed costs.   The…

Q: The amount of revenue required to earn a target profit is equal to Total fixed cost divided by…

A: The break even sales are the sales where business earns no profit no loss.

Q: What is the Breakeven formula when a profit is included: Group of answer choices c. Fixed Costs –…

A: Break-even point is the point at which there is no loss or no profit. It is because the sales…

Q: Which of the following is correct? The break-even point occurs when: Select one: a. total variable…

A: Break even point is the point where the production level at which the production costs equal to the…

Q: The margin of safety is equal to:

A: Financial accounting: Financial accounting is the process of recording, summarizing, and reporting…

Q: CVP analysis is most important for the determination of [A] sales revenue necessary to equal fixed…

A: Cost: It refers to the economic value incurred by the company for producing a product or service.

Q: The increase/decrease in variable cost from existing level to the new level is called as __cost. a.…

A: Variable cost tends to increase or decrease with increased or decreased volume of production whereas…

Q: On the cost-volume-profit graph, the area between the total cost line and the sales line before the…

A: on the cost volume profit graph, the area between the total costline and the sales line before the…

Q: When Total Contribution magrin equals total fixed costs, this indicates operating income True…

A: If the contribution margin is equal to the total fixed cost that means it a situation of the…

Q: Discuss the following components of break-even analysis: fixed costs, variable and semi-variable…

A: Break-even point: It is the point at which the contribution margin earned on sales is equal to fixed…

Q: Which of the following does not represent a cost-volume-profit analysis equation? a. Contribution…

A: Your choice is incorrect because option b. Is represent a cost volume profit analysis equation. The…

Q: With regard to the CVP graph, which of the following statements is NOT correct? a. The CVP graph…

A: Cost volume profit (CVP) graph : A cvp graph shows the break even point as the intersection of the…

Q: Which method results in a more realistic amount for income because it matches the most current costs…

A: The current costs is based on the purchasing of the latest products which means the having book…

Q: On a CVP graph for a profitable company, the total revenue (sales) line will be steeper than the…

A: Cost volume profit analysis: It can be defined as the technique of accounting that is used by the…

Q: Will the profit calculated on the absorption cost basis be higher or lower than the profit…

A: The key difference in profit under marginal costing and absorption costing technique comes because…

Q: Which of the following does not represent a cost-volume-profit analysis equation? O a. Sales - fixed…

A: Cost-volume-profit   equation: Profit = Revenue – Fixed Costs – Variable Costs

Q: revenues equal total fixed costs e given answers on margin equals total costs revenues equal total…

A: A CVP analysis is used to determine the sales volume required to achieve a specified profit level.…

Q: Which of the following statements about CVP analysis is true? O a. Unit selling price, unit variable…

A: Cost volume profit analysis is the methods to identify the impact on operating income due to the…

Q: At the breakeven point Select one: O a. Sales will be equal to variable costs plus fixed costs b.…

A: Formula: Break even point in units = Fixed costs / contribution margin Contribution margin means…

Q: Which of the following best describes a fixed cost? A. Increase proportionately with output. B.…

A: “Since you have asked multiple question, we will solve the first question for you. If you want any…

Q: The break-even point is that level of activity where a. total contribution margin equals the sum of…

A: At break-even point, there is no profit or no loss.

Q: In making a short-term special decision, which of the following is MOST important? a. Use a…

A: Solution Concept The decision that is to be taken differs from one another on the basis of the time…

Q: In the cost-volume- profit graph (above), what is represented by the point marked "B"?

A: Break even point- This is the point where the company will make no profit and no loss, its the point…

Q: In the cost-volume-profit graph,a. the break-even point is found where the total revenue curve…

A: A graphical representation of the relationship between production costs and total sales is shown by…

Q: On a CVP graph, the intersection of the sales revenue line and the total cost line is known as the:…

A: CVP stands for Cost-Volume-Profit analysis. It is helpful in determining the change in the total…

Q: The break-even point is that level of activity where: Select one: O a. profit equals to zero. O b.…

A: Break-Even Point: It is the point of sales at which entity neither earns a profit nor suffers a…

Q: On the cost-volume-profit graph, the area between the total cost line and the sales line after the…

A: CVP analysis helps in determining the effect of variation in the costs on the profitability of an…

Q: On the cost-volume-profit graph, the area between the total cost line and the sales line before the…

A: This is part of break-even analysis.

Q: Contribution margin per unit is the amount by which a product's unit selling price exceeds its…

A: Selling price: Selling price is a price set by the supplier at which he is ready to sell his goods.…

Q: The term 'break even' point is defined as when: A. fixed costs equal total revenues B. variable…

A: The formula for calculating the break even point in units: Break Even Point (in Units)=Fixed…

Q: Which of the following assumptions of the CVP graph is not true? Multiple Choice Costs are linear.…

A: CVP stands forc cost volume price it is a way to find out that how changes in variable and fixed…

Q: Margin of safety ratio is computed by dividing excess of actual or budgeted sales from break- even…

A: Margin of safety ratio = Profit ratio / Contribution margin ratio

Q: When making decisions, managers should consider a. revenues that differ between alternatives. b.…

A: The explanation for the given options:   a. A manager on the verge of making decisions must consider…

Q: In a profit diagram, the safety margin can either be expressed in kronor or some form of volume.…

A: Margin of safety is a financial metric which represents the number of units beyond the break-even…

Q: 4. Which of the following statements is correct? a. Gross margin and contribution margin are the…

A: "Since you have asked multiple questions, we will solve first question for you. If you want any…

Q: What concept relates to the proportionate savings in costs gained when levels of production are…

A: Lets understand the meaning of all the terms given in the question. Accounting profit is a terms…

Q: The “plus” in cost-plus pricing is often referred to as Markup.   Extra profit.   Gross profit.…

A: Cost plus pricing means when selling price is fixed as a addition of profit on the cost price. For…

Q: In a cost-volume-profit (CVP) graph, the intersection of the total sales line and the total expense…

A: The intersection of total sales line and total expense line means, Total sales = Total expense

Q: Which of the following does not represent a cost-volume-profit analysis equation? O a. Contribution…

A: Cost-volume profit analysis is a tool that helps in decision making by establishing a relationship…

Q: Profitability changes may be simply calculated by using what kind of tool: sales…

A: The net profits are calculated as difference between sales and total expenses.

Q: Which of the following statements about CVP analysis is false? O a. Operating income calculations in…

A: Cost-Volume-Profit (CVP) Analysis: It is a method followed to analyze the relationship between the…

Q: Least-squares regression is a statistical method for identifying cost behavior. True or False True…

A: According to the given question, we are required to give the answer that the statement is true or…

Q: The formula for Contribution is Select one: a. Fixed cost + loss b. Sales - Variable cost c. Fixed…

A: Cost accounting system is a framework that guides the firm to calculate their cost and helps in…

Q: a) average fixed cost, b) average variable cost, and c) total profit?

A: Markup Percentage = ((Selling Price - Cost)/Costs) * 100 Fixed and Variable cost - We know that…

Q: What ratio indicates the percentage of each sales dollar that is available to cover fixed costs and…

A: Definition:  Cost-volume profit analysis: CVP analysis is a tool of cost accounting that measures…

Pricing

Pricing is used as a term in finance and economics, pricing is the process of fixing a value for a product or a service. Pricing establishes a value for a product or service that the customer has to pay. A business can choose from different strategies while deciding to set prices.