#	Question	TRUE	FALSE
1	In C-V-P analysis, the greater the 'cost', the higher the contribution margin needs to be to stay solvent
2	Sales revenue - Variable costs - Fixed costs = Operating income
3	Current sales - Break-even sales = Margin of safety
4	In margin of safety analyses, the greater the margin, the more companies can afford to lose (or not sell) in terms of units and/or income
5	Operating leverage increases when variable costs increase relative to fixed costs
6	Fixed costs divided by contribution margin informs management of the number of units that must be produced to break-even
7	if a company wishes to earn a certain income, that level of income is added to fixed costs for the purposes of calculating break-even
8	If a company has a high operating leverage, its contribution margin needs to increase to cover high levels of fixed costs
9	Margins of safety can be calculated in terms of units or income
10	In C-V-P analysis, the contribution margin ratio may be used to calculate break-even in terms of dollars (sales)