Exam 2

Question 1

Which of the following would be a variable cost for a dentist’s office?

Answer 1

d. Cost of teeth cleaning material

Question 2

Per-unit fixed costs:

Answer 2

. Can be misleading and lead to poor decisions.

Question 3

Per-unit variable costs:

Answer 3

Remain constant within the relevant range.

Question 4

The formula for a mixed cost is:

Answer 4

Total cost = total fixed cost + (variable rate x amount of output)

Question 5

Total contribution margin divided by total sales is the

Answer 5

Contribution margin ratio.

Question 6

If the contribution margin ratio increases, the break-even point in sales dollars will

Answer 6

decrease

Question 7

If fixed costs increase, the break-even point in units will

Answer 7

increase

Question 8

The margin of safety in dollars is

Answer 8

Expected sales minus sales at break-even.

Question 9

____ can be measured for a given level of sales by taking the ratio of contribution margin to operating income.

Answer 9

degree of operating leverage