Cost Account - Multiple Choice Questions. If you do not know an answer please le

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Cost Account - Multiple Choice Questions. If you do not know an answer please leave it blank!! thanks kindly

7. Which of the following statements is TRUE in a cost-volume-profit graph?

8. In a cost-volume-profit graph, the total revenue line rises with a slope equal to

a. The slope of the total cost line is dependent on the variable cost per unit. b. The total cost line normally begins at zero. c. The slope of the total revenue line is the contribution margin per unit. d. The total revenue line typically begins above zero.

8. In a cost-volume-profit graph, the total revenue line rises with a slope equal to

a. the contribution margin. b. the selling price. c. None of these choices are correct. d. the variable cost per unit

9. The following diagram is a cost-volume-profit graph for a manufacturing company:



Select the answer that best describes the labeled item on the diagram.

a. Line AC graphs total costs. b. Area CDE represents the area of net loss. c. Point D represents the point at which the contribution margin per unit increases. d. Line AC graphs total fixed costs.

10 The following diagram is a cost-volume-profit graph for a manufacturing company:



The difference between line AB and line AC (area BAC) is the

a. total variable cost. b. contribution margin per unit. c. total fixed cost. d. contribution ratio.

Explanation / Answer

Q7   a. The slope of the total cost line is dependent on the variable cost per unit. Q8 b. the selling price. Q9 a. Line AC graphs total costs. Q10 a. total variable cost.

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