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questions: 1) The cost-volume-profit analysis approach provides a method to asse

ID: 2371724 • Letter: Q

Question

questions:

1)The cost-volume-profit analysis approach provides a method to assess how many units and or sales dollars we need to achieve to make a desired profit

Answer True False


2)If a management accountant provides costs that include significant excess capacity this is helpful to management in their pricing and profitability analysis

Answer True False


3)TSox's are planning its upcoming year. It anticipates selling 50,000 t-shirts, with a price of $20 each. The variable cost per t-shirt is $10. The fixed costs to run the operation are $300,000 per year.

How much profit (ignore taxes) will ABC make if it achieves the projections for the upcoming year?

150,000

15,000

20,000

30,000

50,000


5)TSox's are planning its upcoming year. It anticipates selling t-shirts, with a price of $20 each. The variable cost per t-shirt is $10. The fixed costs to run the operation are $300,000 per year.

If the desired profit (ignoring taxes) is $400,000 how many t-shirts will they need to sell?

50,000

80,000


6)TSox's are planning its upcoming year. It anticipates selling 50,000 t-shirts, with a price of $20 each. The variable cost per t-shirt is $10.

If prices drop by 20% and fixed cost increase as noted what is the new break even point?

50,000

60,000

30,000

70,000


7)If an organization does not use ABC and as result does not properly assign the right costs to a cost object- what are some of the potential problems this may create?


8)From the article Measure Cost Right, describe the major findings/ breakthroughs the authors provide vs. traditional costing systems? What do the authors mean when they refer to the death spiral?

150,000

200,000

250,000

0

4)
TSox's are planning its upcoming year. It anticipates selling 50,000 t-shirts, with a price of $20 each. The variable cost per t-shirt is $10. The fixed costs to run the operation are $300,000 per year.

What is the break even point in units? Answer

15,000

20,000

30,000

50,000


5)TSox's are planning its upcoming year. It anticipates selling t-shirts, with a price of $20 each. The variable cost per t-shirt is $10. The fixed costs to run the operation are $300,000 per year.

If the desired profit (ignoring taxes) is $400,000 how many t-shirts will they need to sell?

Answer

50,000

70,000 45,000

80,000


6)TSox's are planning its upcoming year. It anticipates selling 50,000 t-shirts, with a price of $20 each. The variable cost per t-shirt is $10.

If prices drop by 20% and fixed cost increase as noted what is the new break even point?

The fixed costs have now increased to $420,000 per year. Answer

50,000

60,000

30,000

70,000


7)If an organization does not use ABC and as result does not properly assign the right costs to a cost object- what are some of the potential problems this may create?


8)From the article Measure Cost Right, describe the major findings/ breakthroughs the authors provide vs. traditional costing systems? What do the authors mean when they refer to the death spiral?

Explanation / Answer

1)true

2)true

3)b

4)c

5)c

6)d