pop quiz chapter 3 & 4

A variable cost per unit remains constant at various levels of activity.

• true

• false

A fixed cost remains constant in total and also on a per unit basis at various levels of activity.

• true

• false

If volume increases, all costs will increase.

• true

• false

If the activity level decreases, total variable costs will decrease proportionately.

• true

• false

Changes in the level of activity will cause unit variable and unit fixed costs to change in opposite directions.

• true

• false

The high-low method can be used in classifying a mixed cost into its variable and fixed elements.

• true

• false

In high-low method; the difference between the costs at the high and low levels of activity represents the FIXED COST element of a mixed cost.

• true

• false

The fixed cost element of a mixed cost is the cost of having a service available.

• true

• false

When applying the high-low method, the variable cost element of a mixed cost is calculated before the fixed cost element.

• true

• false

We study about cost behaviour is to help us understanding CVP Analysis elements.

• true

• false