CVP

A cost which remains constant per unit at various levels of activity is a

• variable cost.
• fixed cost.
• mixed cost.
• manufacturing cost.

A fixed cost is a cost which

• varies in total with changes in the level of activity
• remains constant per unit with changes in the level of activity.
• varies inversely in total with changes in the level of activity.
• remains constant in total with changes in the level of activity.

A mixed cost contains

• a variable element and a fixed element.

• both selling and administrative costs.

• both retailing and manufacturing costs.

• both operating and nonoperating costs.

Contribution margin

• is always the same as gross profit margin.
• excludes variable selling costs from its calculation.
• is calculated by subtracting total manufacturing costs per unit from sales revenue per unit.
• equals sales revenue minus variable costs.

A company's only product sells for RM150 per unit. Its variable cost per unit are RM100, and its fixed costs total RM75,000. What is its contribution margin per unit?

• RM50

• RM250

• RM100

• RM25

A company has total fixed costs of $240,000 and a contribution margin ratio of 20%. The total sales necessary to break even are

• $960,000.

• $1,200,000.

• $300,000.

• $288,000.

Reliable Manufacturing wants to sell a sufficient quantity of products to earn a profit of $100,000. If the unit sales price is $10, unit variable cost is $8, and total fixed costs are $200,000, how many units must be sold to earn income of $100,000?

• 150,000 units

• 100,000 units

• 37,500 units

• 1,500,000 units

A company's estimated sales are RM300,000 and its sales at break even are RM180,000. Its margin of safety in dollars is

• RM 180,000

• RM 120,000

• RM 480,000

• RM 60,000