ACCT 1210: Chapters 17 & 18

Front

What is the formula to calculate the contribution margin?

Back

Sales - Variable Costs

Front

How do you calculate the pretax net income?

Back

Contribution margin - Fixed costs

Front

Which formula would be used to calculate activity rates? Options: Total budgeted overhead cost / total budgeted direct labor hours, Manufactured costs added / Equivalent units of production, Overhead costs assigned to pool / Total budgeted overhead costs, Overhead costs assigned to pool / Expected activity level

Back

Overhead costs assigned to pool / Expected activity level

Front

If sales are forecasted at $350,000 and its break-even sales are $280,000, what is the margin of safety in dollars?

Back

$70,000

Front

Which cost would be considered a facility-level cost? Options: Cutting parts, Providing electricity, Recycling hazardous waste, Receiving shipments

Back

Providing electricity

Front

Which formula would be used to determine the degree of operating leverage? Options: Contribution margin in dollars / pretax income, Sales - Variable costs, Fixed costs / Contribution margin per unit, Fixed costs / Contribution margin ratio

Back

Contribution margin in dollars / pretax income

Front

Costs that change in proportion to changes in volume of activity.

Back

Variable costs

Front

The use of a separate cost allocation base for each department in the factory.

Back

Departmental rate

Front

A graph used to analyze past cost behaviors by displaying costs and unit data for each period as points on a diagram.

Back

Scatter diagram

Front

What is the high-low method?

Back

A method that estimates cost behavior by using just the highest and lowest volume levels.