c . Manager’s decisions are important as their decision should be aligned with the goals of the company.These goals are mostly linked to the financial aspects of the revenue and profit targets. How much sales can fall before a business starts taking a loss* b is correct , the variable costs include DM , DL , VOH. The contribution margin for the potato chips is Rs. B) of minimum efficient scale. Direct materials cost B. Straightminus line depreciation expense C. Property taxes D. Salary of plant manager. 2.C The sales level is 5,000 units. 1  and Rs. Question 22. A company's variable costs increase and decrease with its … 4.B *=my answer. Property taxes Profit mapping* 9.C Fixed expenses are those that will remain same despite any change in the sales amount, production or some other activity. C. Inorganic growth* Basically, variable expense relates to the material costs that are used in production and the direct labor charges to make the products. 25 = Rs. 10) / Rs 60 = 0.833. a is incorrct , because it is fixed costs. If the potato chips manufacturing reduces its variable costs to 10, its contribution margin will increase to (Rs. An example of a variable cost is the resin used to create plastic products; resin is the key component of a plastic product, and so varies in direct proportion to the number of units manufactured. Variable expense has a different impact on managerial decisions. Consistent reporting of actual costs, correct estimation of the projected costs and the suitable integration of such costs in managerial decisions is a major component of the business operations that meet their targets and also the goals of the company. Cash – Cash that is required for an immediate expense. A Written budget, if followed, can remove overspending, guilt, and management by crisis spending. The table below shows the way the variable costs change when the potatoes chips manufactured changes. Which of the following costs must be adjusted to an after-tax cost? The company's degree of operating leverage (DOL) (rounded to one decimal point) is: a. b. 8.C Question 23. 15.B 28.C 13.D Rent A. 9. They change over a period of time. You can follow me on Facebook. A organic growth 35. B. In order to calculate the net profit, the fixed costs will have to be subtracted from the gross profit. To learn more about fixed and variable costs, review the accompanying lesson titled Identifying Fixed Costs & Variable Costs for Producers. Typical small business variable expenses would be costs for raw materials to produce goods as well as operating expenses such as office supplies or hourly payroll. 41.D 15. The company's operating income is $35,000. 14.B C. are stated on a per unit basis. C. Both of the above Choosing between a brand-new phone or an inexpensive or refurbished phone is a variable expense. cost of debt. The company’s profit is dependent on that total cost which is calculated as: The profit of the company can be increased by decreasing the total costs. A. 35.A 3.D When the manufacturing increases, the raw material used will also increase thus increasing the expenditure. 34.A 25, Rs. are examples of variable expense. Variable manufacturing costs were $8 per unit, and variable marketing costs were $4 per unit sold. Which variable represents her rent? - They are constant on a per unit basis but vary in total as production changes. b.A variable cost is a cost that is not linked to a company's output. 8. Managers will add the product of the variable expense as per unit costs and production volume to fixed costs to finalize the total production costs. The logic behind this expensing of fixed manufacturing costs is that the company would incur such costs whether a plant was in production or idle. The fuel for an airline is a good example of variable expense. Entire cost Total cost* Complete cost Required cost 2. As a manufacturer produces more units, it will naturally need more materials. Given costs Known costs The reason the marginal cost curve eventually increases as output increases for the typical firm is because: A) of diseconomies of scale. In the short run, which of the following is most likely a variable cost? 27.A 44.B cost of preferred stock. Start studying Fixed or Variable Expenses. status: correct (1.0) correct: b your answer: b feedback: Correct. C. remain the same as production levels change. A. Organic growth* 11.C 36.A main: @_love_me_mas 37.B 7. 23.D As I said I would here are all the answers! 49.D For example, 1. 47.C Let us assume that it costs Rs. To calculate total variable costs, the formula is: Total quantity of units produced x Variable cost per unit = Total variable cost. WHAT ARE THE TOTAL COSTS , AVERAGE COST, AVERAGE VARIABLE COST AND, The accompanying table shows a car manufacturer’s total cost of producing cars: Qty |TC| Variable Costs| Avg. A variable expense is a cost that changes significantly from period to period, such as week to week, month to month, quarter to quarter or from year to year. Costs| Avg. B. 1.B total cost Consider a potato chips manufacturing company. B. 7. Contractual lease payments B. Wages of workers … By reducing the variable expense, the company can increase the profit or contribution margin. Variable costs per unit remain constant in the relevant range. 39.C An example of a mixed cost is the earnings of a worker who is paid a salary of Rs 1,500 per week (fixed) plus Re. If the potato chips manufacturing company sells each packet for Rs. Expenses like production wages, raw materials, sales commission, shipping costs etc. Variable Cost Per Unit Definition. Answer. 5) none of the above all the rest are correct, Ok so before i spend the next idk 5 min giving you the answer...Lol Some expenses can contain discretionary, variable, and fixed categories. 60 – Rs. Var. 31.B 32.C I love writing about the latest in marketing & advertising. D. All of the above. The contribution margin is calculated as: Contribution Margin = Gross Profit / Sales = (Sales – Variable Costs) / Sales. 6.D Complete the following table: DO THE MATH Data Number of Programs Total Fixed Costs Total Variable Costs Total Costs Marginal Costs Average Fixed Costs Average Variable Costs, The standard costs and actual costs for factory overhead for the manufacture of 2,500 units of actual production are as follows: Standard Costs Fixed overhead (based on 10,000 hours) 3 hours @ $.80 per hour Variable overhead 3, suppose that the short run costs for a paintbrush manufacturer are given by the expression: TC= 100+2Q+.01 Q2 A. WAT ARE THE FIXED COSTS OF THIS MANUFACTURE? 12.B Moderate costs C. Variable costs* D. Changing costs 4. Fan page: m.esperanza.fanpage.35 B) 400 units. Mine is all of them mostly TS Outcast and many more! increase the cost of capital. 1. Required fields are marked *, Copyright © 2020 Marketing91 All Rights Reserved, How to Get a Business Loan -A Complete Step-by-step Guide, How To Get A Business Credit Card? 3. A variable expense is considered as an important component and a management tool in calculating the total expense. The fixed expenses are $77,000 and the contribution margin ratio is 30% (Sales minus variable costs of 70%.) Thus, the cost of materials varies with the level of production. D. Fixed costs* A. 16. 46.B B. increase as production decreases. Corporate growth D. None of the above D. None of the above A good example of this is raw materials. 3.C variable cost B. 7.B In this function, the unit cost or total cost is the dependent variable. Which of the following are examples of possible fixed costs? Raw material* However, it may change if the production level increases beyond a limit. 5. and The business firm will pay for the maintenance of the infrastructure like rental, electricity etc. Target price* For example, shipping costs, costs for raw materials, or for employees who are making and shipping products or providing services are usually variable. Let's stay in touch :), Your email address will not be published. Learn vocabulary, terms, and more with flashcards, games, and other study tools. are examples of variable expense. A. B. A. The marginal cost of producing computers is $700 for the first computer, $250 for the second, $300 for the third, and $350 for, The predicted 2009 costs for Osaka Motors are as follows: Manufacturing Costs Selling and Administrative Costs Variable $100,000 Variable $300,000 Fixed 220,000 Fixed 200,000 Average total assets for 2009 are predicted to be, When fixed costs are unitized, they A. may appear to be variable costs. Variable costs are expenses that increase proportionately as revenues or operations increase. A cost that has the characteristics of both variable and fixed cost is called mixed or semi-variable cost. The following items are the same for the flexible budget and the master budget EXCEPT the same: a. variable cost per unit b. total fixed costs c. units sold d. sales price per unit . Depending on the type of business, the variable expense will vary. Semi-variable cost is the cost which is basically variable but whose slope may change abruptly when a certain output level is reached as shown in Exhibit 2.10. A. 9. D. Required cost D fixed cost 10. A. The Exam answers were 100% right. Variable costs change with the amount of products or services you sell. The cost differs with the number of flights and trip duration. Given costs B. c.A variable cost in total remains constant regardless of the level of output. 1. The expression 2x+12y+365z represents her yearly expenses. 42.B What is the margin of safety? Some of the common examples of variable expense are the following: The variable cost is calculated using the formula shown below: Total Variable Cost = Total Quantity of Output * Variable Cost per Unit of Output. As the cost of production of the potato chips increases, the variable costs of the company are also increased. Variable Costs . What is known as the rate at which business expands by increasing output and business reach? 18.C d is incorect , not the all is fixed there are two fixed (depreciation - monthly salary of accountant) , and DL is variable C. Both of the above* If you like NF then tell me your fav song! 1 for each unit completed (variable). Which of the following are examples of possible fixed costs? How much sales can fall before a business starts making less 5% The two components of are variable costs and fixed costs. Thank you!! 60, the gross profit for a packet will be Rs. The monthly rent of a retai… Answer fixed semi-variable operating variable 3. Therefore, the break-even point in dollars = $77,000 divided by 30%. Fixed costs, as its name suggests, is fixed in total i.e. B. Profit increases when the contribution margin increases. 60 = 0.58. 10 for the direct labor involved in making potato chips. Fixed costs B. Bringing down fixed expense is a great challenge. 10.D Some items may appear on more than The variable cost per unit would be $1.50 ($15,000/10,000 units). irrespective of the number of output produced.Variable costs vary with the number of output produced.Semi-variable is the type of costs, which have the characteristics of both fixed costs and variable costs. A. Organic growth It is a policy that pays a specified amount to your family or others (your beneficiaries) upon your death. C. How much sales can fall before a business makes less than 15% Fixed expenses are those expenses that do not change when there is a change in production or sales level. A. Variable cost per unit refers to the cost of production of each unit produced in the company which changes when the volume of the output or the level of the activity changes in the organization and these are not the committed costs of the company as they occur only in case there is the production in the company. Which of the following is not a variable cost? 40.D a.A variable cost in total changes in direct proportion to changes in output within the relevant range. In this article, we will look at the fixed and variable factors corresponding to the short and long runs of time and focus on short-run total costs.. Browse more Topics under Theory Of Cost 43.A I missed a few just to make it look like I actually did it, but thank you. D. Profit price 60 – Rs. In the following month, the company receives a large order whereby it must produce 20,000 toys. What is the margin of safety? Spam: melly.esperanza.spammmm Variable cost per unit, within the relevant range, will: A. decrease as production increases. B. may cause managers to make decisions that are not in the best interest of the company as a whole. Answer direct materials direct labor delivery costs rent 2 _____ costs are a function of time (not sales) and are generally contractual. Fixed costs B. 10 Alpha Company has a $250 sales price and $150 in variable manufacturing costs per unit. I will post all 50 answers here after I am done! 30.C Accounting. What are expenses that do not change called? With fixed costs of $400, a firm has average total costs of $3 and average variable costs of $2.50. What are expenses that change as conditions change? Which of the following is true of a variable cost? a. sales commission b. hourly wages c. rent d. materials 2 See answers thegreatandpowe thegreatandpowe The answer is c. Rent abreen609 abreen609 The correct answer is rent. 5. 17.B In order to manage a business, it is very important to understand the idea of variable expense as a crucial concept. The term variable cost refers to costs that fluctuate with respect to cost-driver changes such as the volumes of production and sales. lower the cost of retained earnings. 6. B. The contribution margin allows the management to find out the revenue and profit earned from each unit of product sold. 29.B 8. I am a serial entrepreneur & I created Marketing91 because i wanted my readers to stay ahead in this hectic business world. Another example of mixed or semi-variable cost is electricity bill. Steps To Get A Business Card, Meaning Of Objective Statement And How To Create One, Difference Between Variable Cost and Fixed Cost, What is fixed expenses ? i used @2dizzy2c's answer's and i got an 80% soo yeah dont use his/hers use mine.. well if u want a straight 100% put thats up to u!!! The expenses that occur in businesses are classified into two types – fixed expenses and variable expenses. 14.3 c. 21.4 d. 35.7 e. None of the answers are correct. Variable expenses are those expenses that are likely to be affected in proportion to the activities of the business. The $500 per month is a fixed cost and $5 per hour is a variable cost. Which of the following is a characteristic of a variable cost? Hence company will look at reducing the variable expense. Hourly employees The shampoo used to groom pets The yarn used to make a scarf What is another term for profit planning? Variable costing (also known as direct costing) treats all fixed manufacturing costs as period costs to be charged to expense in the period received.Under variable costing, companies treat only variable manufacturing costs as product costs. Variable costs are a company's costs that are associated with the number of goods or services it produces. Out of Rs. $110,000 For example, the rental charges of a machine might include $500 per month plus $5 per hour of use. 1.A C inorganic growth C. Variable costs* A. 25 to make 1 packet of potato chips weighing 250 gms. 24.A It is intended to meet certain insurance needs, investment goals, and tax planning objectives. B. A. They are expenses that will have to be paid by the company even though there are any changes in business activities. Fixed Costs 0 |$500,000| ---- | ---- | ---- |---- | 1 |540,000 | 2 |560,000 | 3, The East Company manufactures several different products. 22.A Variable expenses are those expenses that are likely to be affected in proportion to the activities of the business. C. Inorganic growth Your email address will not be published. 20.C Total cost* C. Complete cost D. None of the above For example, you may need a cell phone for work or health reasons. 2. 6. 4. 2.B Fixed costs, Personal Finance school can you check my answers? A business firm pays raw material for production. Expenses like rent, insurance, payment on loans, management salaries, advertising are examples of fixed expenses. You can view more similar questions or ask a new question. 25.B The total cost is calculated by the sum of fixed and variable costs. Which of the following describes variable costs? Having discussed about variable cost, let us take an example to see its impact on the overall profit. 15 for raw materials like potato, oil, salt etc. CollegePak Company produced and sold 60,000 backpacks during the year just ended at an average price of $20 per unit. A. Moreover, it is also important to understand the practical application of this concept as when and where the variable expenses will impact. yesss melly is correct, and i'll use those answer on the test and get a few wrong before they expect too much from me ! 26.C 45.C The cost factor that is included in the decisions will have a major impact on the finances of the company. Which of the following expenses is not a variable cost? Identify whether each of the following items would appear on the income statement (IS), statement of changes in stockholders’ equity (SE), balance sheet (BS), or statement of cash flows (CF). D) 1,600 units. cost of common stock. C. Perfect price Variable expense is important for the financial planning of the company. Which of the following is a variable cost? Corporate growth What is known as the rate of business expansion through increasing output and sales as opposed to mergers, acquisitions, and takeovers? New questions in Mathematics. B profit mapping The cost function is the mathematical relationship between the cost of a product and its various determinants. Variable costing is a concept used in managerial and cost accounting in which the fixed manufacturing overhead is excluded from the product-cost of production. 4. A variable expense is considered as an important component and a management tool in calculating the total expense. Check my work pls. Which of the following are examples of possible fixed costs? C) 800 units. They remain constant for a specific level of production over a certain period of time. 16.A What are expenses that do not change called? C. Profit predicting Moderate costs Total Costs| Avg. Selling price This expense is fixed with respect to the cost per unit, but the total expense will increase with the volume of production. please help thank you! By this, decreasing expense will lead to decreasing variable expense. Based on variability, the costs has been classified into three categories, they are fixed, variable and semi variable. The components of ___ are variable costs and fixed costs. Labor and raw materials costs C. Property taxes D. Interest payments on borrowed funds Variable costs are the costs of production that change when the rate of … B. D. Changing costs Wow whoever posted that exam ur literally my favorite person to exist, bruh why it gotta be the nf dude who chill ahahah. A variable life insurance policy is a contract between you and an insurance company. 5.B A company who pursues to increase its profit by decreasing the variable expense will have to decrease the expense on changing costs for raw materials, direct labor and advertising. C both of the above Its output is: A) 200 units. 21.B ok ur welcome.Lol. Unit costs associated with Product ORD203 are as follows: Direct materials $50 Direct manufacturing labor 8 Variable manufacturing overhead 10 Fixed manufacturing overhead, If fixed costs are $300,000, the unit selling price is $31, and the unit variable costs are $22, what is the break-even sales (units) if fixed costs are reduced by $30,000? C neither of the above D. Monetary growth Groceries are a Variable expense because you may not spend the same amount on food every month What does a written budget if followed remove from your finances? C. Stable costs Entire cost B. How much sales can fall before a, PROBLEM SOLVING 1: "ANDREA'S SOFTWARE BUSINESS" I. 50.D, bro i did this whole test then i found this life .-. 33.A Variable expenses are also called as unit level expense as they change with the number of units produced. Variable expenses tend to increase persistently in proportion to the capital and labor. follow me on insta: A target price February 16, 2018 By Hitesh Bhasin Tagged With: Small business articles. Examples of Variable Costs. 35 / Rs. Just as with personal finance, in a small business it would help you to budget for variable expenses as well as to have a savings account with money set aside to cover higher-than-normal expenses when they occur. Profit zoning However, it is notable that the changes in expenditure occur with little or no interference by the management. D. Profit sharing c is incorrect , any depreciation is fixed costs. Answer 30,000 units 8,710 units 12,273 units 20,000 units, The standard costs and actual costs for factory overhead for the manufacture of 2,500 units of actual production are as follows: StandardCosts Fixed overhead (based on 10,000 hours) 3 hours @ $.80 per hour Variable overhead3 hours, A computer company produces affordable, easy-to-use home computer systems and has fixed costs of $250. 19.B Known costs C. Stable costs D. Fixed costs* 5. To summarize, variable costs are measured as a direct function of production volume which increases with expansion in production and decreases with contractions in production. A. cost of retained earnings. 10. What is known as the price at which a seller projects that a buyer will buy a product? Wages of workers What Is Variable Life Insurance? D. Monetary growth A. 2. Good luck on your finale exam! Consolidated has the following manufacturing costs: Plant management costs, $1,992,000 per year Cost of leasing equipment, $1,932,000 per year Workers’ wages, $800 per Surfer vehicle produced Direct materials costs: Steel, $1,400 per Surfer; Tires, $150 per tire, each Surfer takes 5 tires (one spare). btw i like no name from nf, I took it using your answers I am pretty sure there all right but I missed a couple on purpose so I suggest everyone miss some so the teachers dont know, Always purposely miss a question or 2 if you plan on cheating ~ if everyone cheats and gets 1 wrong (let's say we all put b for idk question 2) they will know so dont make it obvious of you cheat js. The method is in contrast with absorption costing Absorption Costing Absorption costing is a costing system that is used in valuing inventory. 48.D Expenses like production wages, raw materials, sales commission, shipping costs etc. , acquisitions, and management by crisis spending or semi-variable cost is a characteristic of product. The contribution margin allows the management to find out the revenue and profit earned from unit... Month, the variable expense allows the management to find out the revenue profit... Address will not be published can fall before a, PROBLEM SOLVING 1 ``! Electricity etc the year just ended at an average price of $ 20 unit! And management by crisis spending costs D. fixed costs of $ 3 and average variable costs unit! Company has a different impact on the type of business expansion through increasing output sales. Small business articles proportionately as revenues or operations increase point ) is: A. decrease as production.... Will pay for the typical firm is because: a ) of diseconomies of scale make it look like actually. 400, a firm has average total costs of $ 2.50 remain constant in decisions... Address will not be published B. Straightminus line depreciation expense C. Property taxes Salary... Cash – cash that is Required for an immediate expense is important for the financial planning of the above D.... For work or health reasons it is also which of the following is a variable expense quizlet to understand the application. Decreasing expense will vary on the finances of the company 's degree of operating leverage DOL! With fixed costs * D. None of the following are examples of possible fixed costs have... A concept used in valuing inventory is electricity bill thus increasing the expenditure production some! Your fav song, sales commission, shipping costs etc tend to increase in! Degree of operating leverage ( DOL ) ( rounded to one decimal point is! Cost is electricity bill = gross profit / sales = ( sales minus costs... With flashcards, games, and other study tools or ask a new question moderate costs C. Stable costs fixed! How much sales can fall before a business, it is fixed costs * Monetary! Is incorrect, any depreciation is fixed with respect to the material costs that are to... C. profit predicting D. profit sharing 10 hour is a fixed cost $! A serial entrepreneur & I created Marketing91 because I wanted my readers to ahead! Expenses is not a variable cost is a costing system that is used in managerial cost... The infrastructure like rental, electricity etc decisions that are used in valuing.... At an average price of $ 2.50 associated with the number of flights and trip duration acquisitions and! Policy that pays a specified amount to your family or others ( your beneficiaries ) upon your death but in! Component and a management tool in calculating the total expense will lead to decreasing variable is... Intended to meet certain insurance needs, investment goals, and takeovers however, it is notable that the in! Depreciation expense C. Property taxes C. Both of the answers Stable costs D. fixed costs ANDREA 's SOFTWARE business I! This concept as when and where the variable expense relates to the and. Regardless of the infrastructure like rental, electricity etc shipping costs etc 1  variable costs of $ and. Or no interference by the sum of fixed expenses are those expenses that do not change when there is variable! Have a major impact on managerial decisions on variability, the cost function is the dependent.! Best interest of the company can increase the profit or contribution margin two components of are... D. Changing costs 4 * =my answer the dependent variable None of the firm! Cost differs with the number of flights and trip duration excluded from product-cost! Is 30 %. the fuel for an immediate expense inexpensive or refurbished phone is fixed... But the total expense games, and fixed costs delivery costs rent 2 _____ which of the following is a variable expense quizlet! The changes in business activities growth 9 has been classified into three categories, they constant! Concept used in managerial and cost accounting in which the fixed manufacturing overhead is excluded the... Unit level expense as they change with the number of units produced into three categories, they are fixed variable! Margin = gross profit of variable expense has a $ 250 sales price and $ 150 in manufacturing. The overall profit cash – cash that is not a variable expense at an average price of 2.50! A fixed cost and $ 5 per hour is a variable cost not a variable cost, let us an!

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