WorksheetsChapter 4 : Cost Volume Profit
Total questions: 20
Worksheet time: 12mins
Select the correct formulas
BEP in RM = BEP in unit x p
NP = px - bx - a
NP = CM - a
Margin of safety (RM) = px - BEP in RM
b = p - CM per unit
The margin of safety is the difference between sales at break-even and sales at a determined activity level.
true
false
At break-even point; CM = a
true
false
Both variable and fixed costs are included in calculating the contribution margin.
true
false
In CVP analysis, the term “cost” includes manufacturing costs, and selling and administrative expenses.
true
false
Contribution margin is the amount of revenues remaining after deducting cost of goods sold.
true
false
What assumption does this statement say "Break even is 54 units"?
if we sell 55 we aren't making a profit
if we sell 54 we begin to make a profit
if we sell 55 we begin to make a profit
if we sell 54 we are not yet at break even point
What is the formula for contribution?
cost price - selling price
fixed costs - variable costs
selling price - variable cost
selling price - cost price
The mathematical equation for computing required sales to obtain target net income is Required sales =
Variable costs + Target net income.
Variable costs + Fixed costs+ Target net income.
Fixed costs + Target net income.
No correct answer is given.
Margin of safety is computed as:
Actual sales − Break-even sales
Contribution margin − Fixed costs
Break-even sales − Variable costs.
Actual sales − Contribution margin.
Which of the following is not involved in CVP analysis?
Sales mix.
Unit selling prices.
Fixed costs per unit
Volume or level of activity.
