. A contribution approach income statement can usually be easily prepared from the

information contained in a corporation's published income statement.

TRUE FALSE

12. The contribution margin ratio measures the effect on the total contribution margin of a given

change in total sales.

TRUE FALSE

13. At the break-even point, variable expenses and fixed expenses are equal.

TRUE FALSE

14. The break-even point occurs where profits is zero.

TRUE FALSE

All other things the same, a decrease in variable expense per unit will reduce the break-even point.

TRUE FALSE

16. Margin of safety is the excess of variable costs over fixed costs.

TRUE FALSE

17. All other things the same, in periods of increasing sales, net operating income will tend to

increase more rapidly in a company with high variable costs and low fixed costs than in a

company with high fixed costs and low variable costs.

TRUE FALSE

18. Contribution margin and gross margin mean the same thing.

TRUE FALSE