.Multiple choice questions: 1) Which of the following formulae is the right formula for calculating contribution margin...
Question:
.Multiple choice questions:
1) Which of the following formulae is the right formula for calculating contribution margin ratio?
A) Contribution margin ratio = Contribution margin + Net sales revenue
B) Contribution margin ratio = Contribution margin ÷ Net sales revenue
C) Contribution margin ratio = Contribution margin × Net sales revenue
D) Contribution margin ratio = Contribution margin - Net sales revenue
2) One of the assumptions of cost-volume-profit (CVP) analysis is that there are no changes in the:
A) Accounts payable.
B) Cash balance.
C) Inventory levels.
D) Accounts receivables.
3) ________ is a "what if" technique that estimates profit or loss results if selling price, costs, volume, or underlying assumptions change.
A) High-low method of analysis
B) Sensitivity analysis
C) Contribution margin
D) Operating leverage
4) When the total fixed costs increases, the contribution margin per unit:
A) Increases.
B) Decreases.
C) Increases proportionately.
D) Remains the same.
5) When the total fixed costs increases, the breakeven point:
A) Increases.
B) Decreases.
C) Decreases proportionately.
D) Remains the same.
Expert Answer:
