Annette Smith
AC505 week 8 final exam tutorial numbers 2-17
2. Which costs will change with a decrease in activity within the relevant range?
A) Total fixed costs and total variable cost.
B) Unit fixed costs and total variable cost. Answer
C) Unit variable cost and unit fixed cost.
D) Unit fixed cost and total fixed cost.
3. An increase in the activity level within the relevant range results in:
A) an increase in fixed cost per unit.
B) a proportionate increase in total fixed costs.
C) an unchanged fixed cost per unit.
D) a decrease in fixed cost per unit. Answer
Use the following to answer questions 4-5:
The following information has been provided by the Evans Retail Stores, Inc., for the first quarter of the year:
Sales $350,000
Variable selling expense 35,000
Fixed selling expenses 25,000
Cost of goods sold (variable) 160,000
Fixed administrative expenses 55,000
Variable administrative expenses 15,000
4. The gross margin of Evans Retail Stores, Inc. for the first quarter is:
A) $210,000.
B) $140,000.
C) $220,000.
D) $190,000. Answer Sales 350,000 – CGS 160,000 = 190,000
5. The contribution margin of Evans Retail Stores, Inc. for the first quarter is:
A) $300,000.
B) $140,000.
C) $210,000.
D) $190,000.
5. The contribution margin of Evans Retail Stores, Inc. for the first quarter is:
A) $300,000.
B) $140,000. Answer B Sales 350,000 – CGS (variable) 160,000 – Var Sell and Adm 35,000
– Var Adm 15,000 = 140,000
C) $210,000.
D) $190,000.
6. The total contribution margin decreases if sales volume remains the same and:
A) fixed expenses increase.
B) fixed expenses decrease.
C) variable expense per unit increases. Answer
D) variable expense per unit decreases.
7. A company has provided the following data:
Sales 3,000 units
Sales price $70 per unit
Variable cost $50 per unit
Fixed cost $25,000
If the sales volume decreases by 25%, the variable cost per
2. Which costs will change with a decrease in activity within the relevant range?
A) Total fixed costs and total variable cost.
B) Unit fixed costs and total variable cost. Answer
C) Unit variable cost and unit fixed cost.
D) Unit fixed cost and total fixed cost.
3. An increase in the activity level within the relevant range results in:
A) an increase in fixed cost per unit.
B) a proportionate increase in total fixed costs.
C) an unchanged fixed cost per unit.
D) a decrease in fixed cost per unit. Answer
Use the following to answer questions 4-5:
The following information has been provided by the Evans Retail Stores, Inc., for the first quarter of the year:
Sales $350,000
Variable selling expense 35,000
Fixed selling expenses 25,000
Cost of goods sold (variable) 160,000
Fixed administrative expenses 55,000
Variable administrative expenses 15,000
4. The gross margin of Evans Retail Stores, Inc. for the first quarter is:
A) $210,000.
B) $140,000.
C) $220,000.
D) $190,000. Answer Sales 350,000 – CGS 160,000 = 190,000
5. The contribution margin of Evans Retail Stores, Inc. for the first quarter is:
A) $300,000.
B) $140,000.
C) $210,000.
D) $190,000.
5. The contribution margin of Evans Retail Stores, Inc. for the first quarter is:
A) $300,000.
B) $140,000. Answer B Sales 350,000 – CGS (variable) 160,000 – Var Sell and Adm 35,000
– Var Adm 15,000 = 140,000
C) $210,000.
D) $190,000.
6. The total contribution margin decreases if sales volume remains the same and:
A) fixed expenses increase.
B) fixed expenses decrease.
C) variable expense per unit increases. Answer
D) variable expense per unit decreases.
7. A company has provided the following data:
Sales 3,000 units
Sales price $70 per unit
Variable cost $50 per unit
Fixed cost $25,000
If the sales volume decreases by 25%, the variable cost per