Question Completion Status: QUESTION 9 Fawn Company\'s margin of safety is $90,0

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Question Completion Status: QUESTION 9 Fawn Company's margin of safety is $90,000. If the company's sales drop by $80,000, it will still have positive net operating income. True O False QUESTION 10 To estimate what the profit will be at various levels of activity, multiply the number of units to be sold above or below the break-even point by the unit contribution margin. O True O False QUESTION 11 Which of the following costs at a manufacturing company would be treated as a product cost under variable costing? O direct material cost property taxes on the factory building O sales manager's salary O sales commissions QUESTION 12 A cost that would be included in product costs under both absorption costing and variable costing is supervisory salaries O factory rent. O variable manufacturing costs. variable selling expenses. Click Save and Submit to save and submit. Click Save All Answers to save all answers Save All Ans

Explanation / Answer

Q9) True

Because margin of safety is = total sales - Break even point sales

thus it tells at current sales and It means that at the current level of sales and with the company's current prices and cost structure, a reduction in sales of $90,000 would result in just breaking even.

Q10)True

Q11)Direct material cost

under variable costing only variable manufacturing cost like direct material, direct labor and variable production costs are considered only as product costs

q12)Variable manufacturing costs

Q9) True

Because margin of safety is = total sales - Break even point sales

thus it tells at current sales and It means that at the current level of sales and with the company's current prices and cost structure, a reduction in sales of $90,000 would result in just breaking even.

Q10)True

Q11)Direct material cost

under variable costing only variable manufacturing cost like direct material, direct labor and variable production costs are considered only as product costs

q12)Variable manufacturing costs

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