2. Let us assume that fixed and variable costs remain constant the decreases of selling price...

Question

Question

2. Let us assume that fixed and variable costs remain constant the decreases of selling price will * (3 Points) decrease the

business accounting

Add a comment Improve this question Transcribed image text

Answer 1

Answer #1

Break even points in units = Fixed costs/ (Selling price per unit – Variable costs per unit)

= Fixed costs/ Contribution per unit

Break even point (sales dollars) = Fixed Costs ÷ Contribution Margin

If selling price will decrease, contribution per unit will increase and in result increases the break even volume.

If fixed and variable costs remain constant, the decreases of selling price will increase the break even volume.

Answer is b. increase the break - even volume.

Please up vote. Thanks!

Add a comment

Answer 2

Similar Homework Help Questions

2. Let us assume that fixed and variable costs remain constant, the decreases of selling price...

2. Let us assume that fixed and variable costs remain constant, the decreases of selling price will (3 Points) decrease the break even volume have no any effect increase the break-even volume decrease resource drivers increase resource drivers 3.In an activity-based costing system, direct materials used would typically be classified as a (3 Points) unit-level cost batch-level cost facility-level cost product-sustaining cost management-level cost
1.Let us assume that fixed and variable costs remain constant, the decreases of selling price will...

1.Let us assume that fixed and variable costs remain constant, the decreases of selling price will a.increase resource drivers b.decrease resource drivers c.decrease the break-even volume d.have no any effect e.increase the break-even volume 2/….is the difference between the budgeted (expected) sales and breakeven sales. a.Margin of safety percentage b.Margin of safety c.Expected sales d.Actual sales 3.Cost management systems, such as Activity Based Costing, tend to focus on an organization's: a.activities b.machines c.customers d.employees e.rules and regulations 4.Costs that are...
Solve the MCQs please Cost management systems, such as Activity Based Costing, tend to focus on...

Solve the MCQs please Cost management systems, such as Activity Based Costing, tend to focus on an organization's: activities rules and regulations machines employees customers 2:) The division of activities into unit-level, batch-level, product-sustaining level, and facility-level categories is commonly known as a cost: classification scheme that is useful in traditional, volume-based systems application method hierarchy object estimation method 3:) Let us assume that fixed and variable costs remain constant, the decreases of selling price will have no any effect...

20. If total fixed costs decrease by $5,000, selling price per unit increases by $2, and...

20. If total fixed costs decrease by $5,000, selling price per unit increases by $2, and unit variable increases by $1, which of the following is true? Unit Contribution Break-Even Margin Volume Increase Increase Increase Decrease Decrease Increase Decrease Decrease E. Not enough information
Required information Exercise 6-5 Changes in Variable Costs, Fixed Costs, Selling Price, and Volume (L06-4) [The...

Required information Exercise 6-5 Changes in Variable Costs, Fixed Costs, Selling Price, and Volume (L06-4) [The following information applies to the questions displayed below.) Data for Hermann Corporation are shown below: Selling price Variable expenses Contribution margin Per Unit $ 90 63 $ 27 Percent of Sales 1009 70 304 Fixed expenses are $78,000 per month and the company is selling 3,500 units per month Exercise 6-5 Part 2 2-a. Refer to the original data. How much will net operating...
Lec Exercise 6-5 Changes in Variable Costs, Fixed Costs, Selling Price, and Volume (L06-4) [The following...

Lec Exercise 6-5 Changes in Variable Costs, Fixed Costs, Selling Price, and Volume (L06-4) [The following information applies to the questions displayed below.) Data for Hermann Corporation are shown below: Selling price Variable expenses Contribution margin Per Unit S 85 51 S 34 Percent of Sales 1008 60 400 Fixed expenses are $77,000 per month and the company is selling 2,600 units per month, Exercise 6-5 Part 1 Required: 1-a. How much will net operating income increase (decrease) per month...

A) Further analysis of McCartney Manufacturing’s fixed costs revealed that the company actually faces annual fixed...

A) Further analysis of McCartney Manufacturing’s fixed costs revealed that the company actually faces annual fixed overhead costs of $9,800 and annual fixed selling and administrative costs of $4,200. Variable cost estimates are correct: direct materials cost, $2.40 per unit; direct labor costs, $3.00 per unit; and variable overhead costs, $0.60 per unit. At this time, the selling price of $20 will not change. Complete the following formulas for the revised fixed costs. Enter the ratio as a percentage. Contribution...
A) Further analysis of McCartney Manufacturing’s fixed costs revealed that the company actually faces annual fixed overh...

A) Further analysis of McCartney Manufacturing’s fixed costs revealed that the company actually faces annual fixed overhead costs of $9,800 and annual fixed selling and administrative costs of $4,200. Variable cost estimates are correct: direct materials cost, $2.40 per unit; direct labor costs, $3.00 per unit; and variable overhead costs, $0.60 per unit. At this time, the selling price of $20 will not change. Complete the following formulas for the revised fixed costs. Enter the ratio as a percentage. Contribution...
Abensan Company sells a single product. If both the selling price and variable cost per unit...

Abensan Company sells a single product. If both the selling price and variable cost per unit increase by 5% and fixed costs remain steady, then contribution margin per unit and break- even point in units will, respectively, decrease and increase. increase and remain unchanged. decrease and remain unchanged. O increase and decrease.

20.20 UNLINE Exercise 3-5 Changes in Variable Costs, Fixed Costs, Selling Price, and Volume [LO3-41 The...

20.20 UNLINE Exercise 3-5 Changes in Variable Costs, Fixed Costs, Selling Price, and Volume [LO3-41 The following information applies to the questions displayed below. Data for Hermann Corporation are shown below: Percent Per of Unit Sales Selling price $140 100% Variable 91 65% expenses Contributions 49 35% margin Fixed expenses are $85,000 per month and the company is selling 3,000 units per month References Section Break Exercise 3-5 Changes in Variable Costs, Fixed Costs, Selling Price, and Volume [LO3-4) 3...

2. Let us assume that fixed and variable costs remain constant the decreases of selling price...

Homework Answers

Add Answer to:
2. Let us assume that fixed and variable costs remain constant the decreases of selling price...

Post as a guest

Earn Coins