# Managerial Accounting Ch. 7 Pre-Quizzes

Total word count: 415
Pages: 2

### Calculate the Price

- -
275 words
Looking for Expert Opinion?
Let us have a look at your work and suggest how to improve it!
 Total contribution margin less total fixed expenses equals operating income. The unit contribution margin is computed by subtracting the variable cost per unit from the sales price per unit. The contribution margin ratio explains the percentage of each sales dollar that contributes toward fixed costs and generating a profit. CVP analysis assumes all of the following except inventory levels will increase. To the left of the breakeven point on a CVP graph, the area between the total expense line and the sales revenue line represents which of the following? Operating loss To find the number of units that need to be sold in order to breakeven or generate a target profit, the formula used is (fixed expenses + operating income) / contribution margin per unit To find the sales revenue (sales in dollars) needed in order to breakeven or generate a target profit, the formula used is (fixed expenses + operating income) / contribution margin ratio To find the sales revenue need to breakeven, the formula used could be fixed expenses / contribution margin ratio To find the number of units that need to be sold to breakeven, the formula used could be fixed expenses / contribution margin per unit The breakeven point may be defined as the number of units a company must sell to do which of the following? Generate a zero profit Sales above the breakeven point indicate a ______, whereas sales below the breakeven point indicate a ______. profit; loss The horizontal line intersecting the vertical y-axis at the level of total cost on a CVP graph represents total fixed costs. Company A has a higher safety of margin while Company B has a lower safety of margin. Company a would be considered _______ Company when considering only margin of safety. less risky than A company’s margin of safety can be stated any of the above (in dollars, as a percentage of sales, in units) A company’s margin of safety is computed as expected sales – sales at breakeven. All else being equal, a company with high operating leverage will have relatively high contribution margin ratio. All else being equal, a company with a low operating leverage will have relatively high variable costs. To find a firm’s operating leverage factor at a given level of sales, you divide the contribution margin by operating income. By multiplying the operating leverage by the anticipated percentage change in volume, one can find the anticipated change in operating income. The higher the operating leverage factor, the greater the impact of volume on operating income.

### More flashcards like this

#### NCLEX 10000 Integumentary Disorders

When assessing a client with partial-thickness burns over 60% of the body, which finding should the nurse report immediately? a) ...

#### NCLEX 300-NEURO

A client with amyotrophic lateral sclerosis (ALS) tells the nurse, "Sometimes I feel so frustrated. I can’t do anything without ...

#### NASM Flashcards

Which of the following is the process of getting oxygen from the environment to the tissues of the body? Diffusion ...

## Unfinished tasks keep piling up?

Let us complete them for you. Quickly and professionally.

Check Price