Question

In the manufacturing sector, ________. A. fixed overhead costs are subtracted to determine gross margin B....

In the manufacturing sector, ________.

  • A. fixed overhead costs are subtracted to determine gross margin

  • B. fixed overhead costs are subtracted to determine contribution margin

  • C. all operating costs are subtracted to determine contribution margin

  • D. only variable costs are subtracted to determine gross margin

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

In a manufacturing sector, fixed overead costs are subtracted to determine gross margin.

Option A is correct because Gross margin = Revenues - Cost of goods sold

Cost of goods sold includes both variable and fixed overhead cost.

Option B is incorrect because only variable cost are substracted to determine the contribution margin.

Contribution margin = Sales - Variale cost

Option C. is incorrect because only variable operating costs (which are not related to production) are subtracted to determine contribution margin.

Option D. is incorrect because both variable cost and fixed costs are subtracted to determine gross margin.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Under variable costing, ______________ costs are considered product costs. variable manufacturing overhead fixed manufacturing overhead fixed...
Under variable costing, ______________ costs are considered product costs. variable manufacturing overhead fixed manufacturing overhead fixed selling and administrative property tax on the administrative office
________ is the excess of sales over the cost of goods sold. A) Gross margin B)...
________ is the excess of sales over the cost of goods sold. A) Gross margin B) Contribution-margin ratio C) Variable-cost ratio D) Contribution margin Answer: Which statement is FALSE? A) Each different sales-mix of products has a different break-even point. B) Changes in the sales-mix of products sold affects a company's net operating profit. C) Changes in the sales-mix of products sold affects a company's contribution margin. D) If the sales-mix of products sold changes, the break-even point does not...
At the break-even point, Select one: a. sales equal total fixed costs. b. contribution margin equals...
At the break-even point, Select one: a. sales equal total fixed costs. b. contribution margin equals total variable costs. c. total variable costs equal total fixed costs. d. total operating costs equal sales. e. none of these answer choices are correct. f. sales equal total variable costs.
Selling price per unit $55 Variable manufacturing costs $23 Annual fixed manufacturing costs $450000 Variable, marketing,...
Selling price per unit $55 Variable manufacturing costs $23 Annual fixed manufacturing costs $450000 Variable, marketing, distribution and administration costs $9 Annual fixed non-manufacturing costs $229000 Annual volume 50000 a. Calculate the contribution margin per unit.                                          b. Calculate the contribution margin ratio. c. Calculate the break-even in units and sales dollars for 2016. d.Calculate the profit earned in 2016.
. Assume that the CDE Company has yearly Fixed costs of $30,000 and its Variable costs...
. Assume that the CDE Company has yearly Fixed costs of $30,000 and its Variable costs are $30,000, which are 60% of its Sales. Calculate: [Use ONLY formula for your calculations. Do NOT use algebra] Question: Its profit or loss when its total sales are $110,000.      b. The sales level (dollars) required to break-even.      c. The sales needed to make a profit of $35,000. 2. ABC Company manufactures and distributes Product A. An extract from the 20X5 statement...
1- Costs for direct materials, direct labor and manufacturing overhead are assigned to each job. True...
1- Costs for direct materials, direct labor and manufacturing overhead are assigned to each job. True or false 2- J&A Corporation has a monthly target operating income of $35,000. Variable expenses are 30% of sales and monthly fixed expenses are $7,000. What is the monthly margin of safety in dollars if the business achieves its operating income goal? A) $60,000 B) $70,000 C) $50,000 D) $21,000 3- At Dwight Incorporated, total fixed and variable costs are $430,000 at a production...
A manufacturing company gross margin income statement refers to sales revenue minus: variable costs, excluding variable...
A manufacturing company gross margin income statement refers to sales revenue minus: variable costs, excluding variable marketing and administrative costs. all variable costs, including variable marketing and administrative costs. cost of goods sold, excluding fixed indirect manufacturing costs. cost of goods sold, including fixed indirect manufacturing costs. Fixed costs are different than variable costs because (CMA adapted) Total variable costs are variable over the relevant range but fixed in the long-term, while fixed costs never change. Unit variable costs fluctuate...
1. Relevant information refers to ________ that will differ among the alternative courses of action. A)...
1. Relevant information refers to ________ that will differ among the alternative courses of action. A) future costs only B) future revenues only C) future costs and revenues D) past costs and revenues 2. Fixed selling expenses affect the calculation of ________ on the contribution income statement. Fixed selling expenses do NOT affect the calculation of ________ on the absorption income statement. A) contribution margin; gross margin B) operating income; gross margin C) gross margin; contribution margin D) operating income;...
Question 16 Helton Company has the following information for the current year: Beginning fixed manufacturing overhead...
Question 16 Helton Company has the following information for the current year: Beginning fixed manufacturing overhead in inventory $95,000 Fixed manufacturing overhead in production 375,000 Ending fixed manufacturing overhead in inventory 25,000 Beginning variable manufacturing overhead in inventory $10,000 Variable manufacturing overhead in production 50,000 Ending variable manufacturing overhead in inventory 15,000 What is the difference between operating incomes under absorption costing and variable costing? Select one: A. $5,000 B. $65,000 C. $70,000 D. $50,000 E. $40,000 Question 17 A...
The total contribution margin at the break-even point: a. Equals total fixed costs b. Is zero...
The total contribution margin at the break-even point: a. Equals total fixed costs b. Is zero c. Is greater than total variable costs d. Plus total fixed costs equal total revenues
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT