Question

Give me the answer of the following MCQs

1. Which of the following is an example of a fixed cost? Select one:

A. Depreciation of manufacturing equipment

B. Utility expense for electricity usage

C. Hourly Wages

D. None of the above

2. Which method of cost data analysis involves approximating a linear cost relationship based on the extremes of production volume? Select one:

A. Scattergraph method

B. High-low method

C. All of the above

D. None of the above

3. Which method of cost data analysis is generally considered the most accurate? Select one:

A. Scattergraph method

B. High-low method

C. Least-squares regression method

D. None of the above

4. Which of the following is not an assumption of CVP analysis? Select one:

A. Sales price will remain constant on a per-unit basis regardless of the level of sales.

B. The sales mix ratio (for multiple products) remains constant.

C. All costs are variable in the relevant range.

D. All of the above

5. Which equation properly represents the Margin of Safety ratio? Select one:

A. (Actual Sales - Break-even Sales) / Actual Sales

B. Break-even Sales / Actual Sales

C. (1 - Actual Sales) / Break-even Sales

D. (1 - Break-even Sales) / Break-even Sales

6. Which of the following statements is true regarding CVP analysis? Select one:

A. CVP can be used with multiple products only if the product ratio is fixed and based on a weighted average unit contribution margin

B. CVP cannot be used in service industries

C. CVP is useful in all types of business and with any number of products and product mixes

D. None of the above

Answer 1