TRUE OR FALSE Net income under variable costing is unaffected by changes in production levels.

Variable costing income will be greater than absorption costing income when:   a. Sales is greater than production.   b. contribution pricing is applied   c. Production is less than or equal to sales.   d. Production is greater than sales

Which of the following statements regarding marginal costing is incorrect? Select one: O A. It is useful long-term planning technique OB. It assumes that fixed costs remain fixed over relevant activity ranges O C. It assumes that variable costs vary in proportion to activity O D. It assumes that costs can be classified as variable or fixed

Why functional (or volume)- based costing approaches may produce distorted costs.

A cost that cannot be changed because it arises from a past decision and is irrelevant to future decisions is a. An uncontrollable cost. d. An opportunity cost. b. An out-of-pocket cost. e. An incremental cost. c. A sunk cost.

Which of the following statements is FALSE? a. There is a cause-and-effect relationship between the cost driver and the amount of cost. b. Over the long run all costs have cost drivers. c. Volume of production is a cost driver of direct manufacturing costs. d. Fixed costs have cost drivers over the short run.

Which type of cost has an unchanging total expense and a decreasing average expense as output increases?

The contribution margin approach helps managers in short-term decision making because it A. reports costs and revenues at present value B. reports only mixed costs C. treats fixed manufacturing overhead as product costs D. isolates costs by behavior