True or False Questions.1. A contribution approach income statementcan usually be easily prepared from theinformationcontained in a corporation's publishedincome statement.True False2. The profit in cost-volume-profit equations isthe same as the net operating income on acontribution income statement.True False3. On a cost-volume-profit graph, the revenueline will be shown above the total expenseline for anyactivity level above the break-even point.True False4. On a CVP graph for a profitable company,the line representing total expenses is steeperthan theline representing total revenue.True False

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Description: True or False Questions.1. A contribution approach income statementcan usually be easily prepared from theinformationcontained in a corporation's publishedincome statement.True False2. The profit in cost-volume-profit equations isthe same as the net

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True or False Questions. 1. A contribution approach income statement can usually be easily prepared from the information contained in a corporation's published income statement. True False

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter9: Responsibility Accounting And Decentralization

Section: Chapter Questions

Problem 6PA: Using the information from BDS Enterprises, prepare the income statement to include all costs, but...

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Using the information from BDS Enterprises, prepare the income statement to include all costs, but separate out uncontrollable costs. Insert subtotals where appropriate (include one for operating income) before the uncontrollable costs. Income tax expense should be based on all expenses (that is, it will be the same amount as in question 1). Calculate net income, profit margin, ROI, and RI, excluding uncontrollable expenses. Prepare a short response to accompany the income statement that explains why uncontrollable costs are separated in the income statement.
Which of the following is the indicator of the rate at which company is earning profit? Select one: a. Margin of safety b. All options are correct c. Contribution margin d. Profit volume ratio
On a cost-volume-profit graph, when the Total Cost line is higher than the Total Revenue line, the difference represents Select one: O A. a positive return on the investment O B. a net loss O C. net income O D. not enough information is presented
In the cost-volume- profit graph (above), what is represented by the point marked "B"? Question 2 options: Breakeven point Fixed expenses Operating income area Operating loss area
On a CVP graph for a profitable company, the total expense line will be steeper than the total revenue line. True or False True False
1. A profit-volume graph differs from a cost-volume-profits graph in that a profit-volume graph displays onlya. costs associated with units produced.b. operating income associated with expected sales.c. revenues and costs associated with sales volume.d. revenues expected at targeted sales levels.e. All of these are correct. 2. Fixed expenses that cannot be directly traced to individual segments are calleda. cost structure.b. direct fixed expenses.c. operating leverage.d. common fixed expenses.e. indifference point. 3. If sales remain the same and the margin of safety increases, which of the following is true?a. The break-even point has decreased.b. The common fixed costs have increased.c. The break-even point has remained constant.d. Variable costs have increased. 4. Match the type of income statement to the costs it includes.a. Variable costing income statementb. Absorption costing income statementc. Both types of income statements 1. Direct materials for units sold2.…
Using the table below, create a line chart in which profit or loss is plotted on the Y-axis and sales volume is plotted on the X-axis. This is commonly called a profit/volume chart. Although sales volume can be expressed in either units or dollars, use units for your chart. Complete the Chart Tickler Data Table to include a column for profits. Use this table as a basis for preparing the chart. Cost-Volume-Profit Analysis Data Section Income Statement in a Contribution Margin Fixed Variable Particulars Amounts Production costs Projected unit sales 120,000 Direct materials $2.30 Selling price per unit $16.00 Direct labor 4.70 Less Vairable Cost Factory overhead $225,000 3.00 Direct materials $2.30 Selling expenses Direct labor 4.70 Sales salaries & commissions 97,000 0.75 Factory overhead…
46. Revenue, cost, and profit. The price-demand equation and the cost function for the production of HDTVS are given, respectively, by x 9,000 - 30p and C(x) = 150,000 + 30x where x is the number of HDTVS that can be sold at a price of $p per TV and C(x) is the total cost (in dollars) of produc- ing x TVs.
Break-Even Chart Name the following chart, and identify the items represented by the letters (a) through (f): Name the chart pictured above.Profit-volume chart Identify the items represented by the letters (a)-(f) shown above.
Which of the following does not represent a cost -volume -profit analysis equation a. Sales = totale expenses + profit b. Sales + fixed expenses profit = contribi argin + sales c. Profit = contrib contribution margin - fixed expenses d. Contribution margin- fixed expenses - profit 0 e. Sales - fixed expenses - variable expenses ses = 0
Using the information for Lighthizer Trading Company, prepare the income statement to include all costs, but separate out uncontrollable costs. Insert subtotals where appropriate (include one for operating income) before the uncontrollable costs. Income tax expense should be based on all expenses (that is, it will be the same amount as in the previous exercise). Calculate net income, profit margin, ROI, and RI excluding uncontrollable expenses. Prepare a short response to accompany the income statement that explains why uncontrollable costs are separated in the income statement.
The measurement of earnings concept that consists of a companys profit from operations after taxed are subtracted is ________. A. ROI B. EPS C. EBITDA D. NOPAT