10. The difference between variable costs and fixed cost is A. Variable costs per unit fuctuate and fixed costs per unit remain constant B. Variable costs per unit are fixed over the relevant range and fixed costs per unit are variable C. Total variable costs are variable over the relevant range and fixed in the long term. while fixed costs never change. Variable costs per unit change in varying increments, while fixed costs per unit change in equal increments 11. Other things being equal, income computed by the direct costing method will exceed that computed by an absorption costing method if A. Variable manufacturing cost increases r) B. Fixed manufacturing cost increases C. Units produced exceed units sold D. Units sold exceed units produced P 12. An unfavorable direct labor efficiency variance could be caused by a(n) A. Unfavorable variable overhead spending variance B. Unfavorable materials usage variance C. Unfavorable fixed overhead volume variance. D. Favorable variable overhead spending 13. Managers use it as a reminder that if sales dropped by this amount, the company may start incurring losses. A. Sensitivity analysis B. Indifference point y C. Margin of safety D. Contribution margin ratio 14. When selling prices and inventory costs are stable, a decrease in units sold would make the: Cost Volume Variance A. Favorable B. Unfavorable C. Unfavorable D. Favorable Variance Favorable Unfavorable Favorable Unfavorable 15. Which of the following will have the most favorable effect in gross profit? _A, 10% increase in selling price B. 10% decrease in cost price C. 10% increase in both selling price and cost price D. 10% decrease in selling and administrative expenses