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

a. manufacturing cost

b. Variable cost

c. fixed cost

d. Mixed cost

-------------------------------------------------

Two costs at Bradshaw Company appear below for specific months of operation.

	Month		Amount		Units Produced
Delivery costs	September		$40,000		40,000
	October		55,000		60,000
Utilities	September		$84,000		40,000
	October		126,000		60,000

Which type of costs are these?

Delivery costs and utilities are both mixed.

Utilities are mixed and delivery costs are variable.

Delivery costs are mixed and utilities are variable.

Delivery costs and utilities are both variable.

-----------------------------------------------

An increase in the level of activity will have the following effects on unit costs for variable and fixed costs:

Unit Variable Cost

Unit Fixed Cost

Remains constant

Decreases

Decreases

Remains constant

Increases

Decreases

Remains constant

Remains constant

------------------------------

Greg's Breads can produce and sell only one of the following two products:

	Oven		Contribution
	Hours Required		Margin Per Unit
Muffins	0.2		$3
Coffee Cakes	0.3		$4

The company has oven capacity of 1,200 hours. How much will contribution margin be if it produces only the most profitable product?

$24,000

$12,000

$16,000

$18,000