What are expenses that do not change called? A business firm pays raw material for production. D. Fixed costs* C. Both of the above 1 for each unit completed (variable). 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 ? A. 31.B Profit increases when the contribution margin increases. The expression 2x+12y+365z represents her yearly expenses. Which of the following are examples of possible fixed costs? 44.B A. Property taxes 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 . Variable expenses tend to increase persistently in proportion to the capital and labor. 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. 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. 16. Hourly employees The shampoo used to groom pets The yarn used to make a scarf The Exam answers were 100% right. The company's degree of operating leverage (DOL) (rounded to one decimal point) is: a. b. please help thank you! Let's stay in touch :), Your email address will not be published. Variable expense is important for the financial planning of the company. D. Profit price 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. To calculate total variable costs, the formula is: Total quantity of units produced x Variable cost per unit = Total variable cost. 8. However, it may change if the production level increases beyond a limit. C neither of the above 14.B Costs| Avg. C. remain the same as production levels change. A. I missed a few just to make it look like I actually did it, but thank you. Direct materials cost B. Straightminus line depreciation expense C. Property taxes D. Salary of plant manager. main: @_love_me_mas Variable manufacturing costs were $8 per unit, and variable marketing costs were $4 per unit sold. 1. A. If the potato chips manufacturing company sells each packet for Rs. Total Costs| Avg. a.A variable cost in total changes in direct proportion to changes in output within the relevant range. A variable expense is considered as an important component and a management tool in calculating the total expense. 7. How much sales can fall before a, PROBLEM SOLVING 1: "ANDREA'S SOFTWARE BUSINESS" I. Depending on the type of business, the variable expense will vary. What is known as the price at which a seller projects that a buyer will buy a product? What is the margin of safety? Wow whoever posted that exam ur literally my favorite person to exist, bruh why it gotta be the nf dude who chill ahahah. 10. 14.3 c. 21.4 d. 35.7 e. None of the answers are correct. C. Inorganic growth* Variable costs per unit remain constant in the relevant range. 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. 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. They are expenses that will have to be paid by the company even though there are any changes in business activities. The total cost is calculated by the sum of fixed and variable costs. Question 22. Expenses like production wages, raw materials, sales commission, shipping costs etc. 16.A Wages of workers … Accounting. By reducing the variable expense, the company can increase the profit or contribution margin. D) 1,600 units. 1. A organic growth Profit zoning A. The cost function is the mathematical relationship between the cost of a product and its various determinants. The fuel for an airline is a good example of variable expense. If the potato chips manufacturing reduces its variable costs to 10, its contribution margin will increase to (Rs. How much sales can fall before a business starts taking a loss* Your email address will not be published. 60 – Rs. Thank you!! Variable expenses are those expenses that are likely to be affected in proportion to the activities of the business. 36.A Fixed expenses are those expenses that do not change when there is a change in production or sales level. 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. 40.D 2.C - They are constant on a per unit basis but vary in total as production changes. b is correct , the variable costs include DM , DL , VOH. d is incorect , not the all is fixed there are two fixed (depreciation - monthly salary of accountant) , and DL is variable The term variable cost refers to costs that fluctuate with respect to cost-driver changes such as the volumes of production and sales. Fixed costs 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? 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? Target price* Which of the following are examples of possible fixed costs? The fixed expenses are $77,000 and the contribution margin ratio is 30% (Sales minus variable costs of 70%.) 10 for the direct labor involved in making potato chips. 24.A D. Changing costs Rent 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. 7.B 3.D The cost factor that is included in the decisions will have a major impact on the finances of the company. It is a policy that pays a specified amount to your family or others (your beneficiaries) upon your death. 2.B Corporate growth 1.A Variable Cost Per Unit Definition. 9. Fixed costs, as its name suggests, is fixed in total i.e. Mine is all of them mostly TS Outcast and many more! 10. Which of the following are examples of possible fixed costs? 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. 25 to make 1 packet of potato chips weighing 250 gms. Entire cost 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. I love writing about the latest in marketing & advertising. Variable costs change with the amount of products or services you sell. 3. 42.B 29.B Consider a potato chips manufacturing company. What is known as the rate of business expansion through increasing output and sales as opposed to mergers, acquisitions, and takeovers? 5. Var. The expenses that occur in businesses are classified into two types – fixed expenses and variable expenses. C) 800 units. Selling price C. are stated on a per unit basis. I will post all 50 answers here after I am done! Based on variability, the costs has been classified into three categories, they are fixed, variable and semi variable. 15.B 45.C Variable expense has a different impact on managerial decisions. A cost that has the characteristics of both variable and fixed cost is called mixed or semi-variable cost. C both of the above 39.C As a manufacturer produces more units, it will naturally need more materials. 3.C variable cost 25.B Wages of workers B. B. D. Monetary growth *=my answer. cost of debt. It is intended to meet certain insurance needs, investment goals, and tax planning objectives. C. Inorganic growth Expenses like production wages, raw materials, sales commission, shipping costs etc. and CollegePak Company produced and sold 60,000 backpacks during the year just ended at an average price of $20 per unit. 15 for raw materials like potato, oil, salt etc. 27.A Having discussed about variable cost, let us take an example to see its impact on the overall profit. For example, 1. A. A good example of this is raw materials. 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. The company's operating income is $35,000. Total cost* 1.B total cost 13.D C inorganic growth 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. 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. Known costs C. Stable costs D. Fixed costs* 5. 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. 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. D fixed cost Basically, variable expense relates to the material costs that are used in production and the direct labor charges to make the products. Which of the following describes variable costs? are examples of variable expense. 47.C 32.C 21.B B. C. Both of the above* B. may cause managers to make decisions that are not in the best interest of the company as a whole. 10.D D. Profit sharing However, it is notable that the changes in expenditure occur with little or no interference by the management. follow me on insta: 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 C. Stable costs 10 Alpha Company has a $250 sales price and $150 in variable manufacturing costs per unit. 25, Rs. B. A. 4. Variable costs are expenses that increase proportionately as revenues or operations increase. The table below shows the way the variable costs change when the potatoes chips manufactured changes. 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 The cost differs with the number of flights and trip duration. 43.A Some expenses can contain discretionary, variable, and fixed categories. The contribution margin is calculated as: Contribution Margin = Gross Profit / Sales = (Sales – Variable Costs) / Sales. Examples of Variable Costs. In the following month, the company receives a large order whereby it must produce 20,000 toys. 1 Entire cost Total cost* Complete cost Required cost 2. February 16, 2018 By Hitesh Bhasin Tagged With: Small business articles. What is the margin of safety? 28.C A. 20.C Given costs B. 35 / Rs. B) of minimum efficient scale. lower the cost of retained earnings. A. Organic growth* The $500 per month is a fixed cost and $5 per hour is a variable cost. The business firm will pay for the maintenance of the infrastructure like rental, electricity etc. B. 41.D 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. The contribution margin for the potato chips is Rs. 4. What Is Variable Life Insurance? Check my work pls. 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? D. None of the above A. B. 5. In order to manage a business, it is very important to understand the idea of variable expense as a crucial concept. Which of the following is true of a variable cost? A. New questions in Mathematics. How much sales can fall before a business starts making less 5% Its output is: A) 200 units. 8.C 6. D. All of the above. What are expenses that change as conditions change? In this function, the unit cost or total cost is the dependent variable. If you like NF then tell me your fav song! 18.C Fixed expenses are those that will remain same despite any change in the sales amount, production or some other activity. They remain constant for a specific level of production over a certain period of time. A variable life insurance policy is a contract between you and an insurance company. Variable cost per unit, within the relevant range, will: A. decrease as production increases. 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. cost of common stock. This expense is fixed with respect to the cost per unit, but the total expense will increase with the volume of production. Moderate costs 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. Choosing between a brand-new phone or an inexpensive or refurbished phone is a variable expense. 10) / Rs 60 = 0.833. 25 = Rs. What is another term for profit planning? 23.D 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. ok ur welcome.Lol. 2. 12.B A. A company's variable costs increase and decrease with its … c is incorrect , any depreciation is 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 … The monthly rent of a retai… Answer fixed semi-variable operating variable 3. $110,000 a is incorrct , because it is fixed costs. 6.D B) 400 units. A variable expense is considered as an important component and a management tool in calculating the total expense. Bringing down fixed expense is a great challenge. Which of the following is a variable cost? Variable expenses are also called as unit level expense as they change with the number of units produced. Thus, the cost of materials varies with the level of production. Corporate growth C. How much sales can fall before a business makes less than 15% Variable costs are a company's costs that are associated with the number of goods or services it produces. The components of ___ are variable costs and fixed costs. Hence company will look at reducing the variable expense. A Written budget, if followed, can remove overspending, guilt, and management by crisis spending. c . B. Another example of mixed or semi-variable cost is electricity bill. 48.D Question 23. The method is in contrast with absorption costing Absorption Costing Absorption costing is a costing system that is used in valuing inventory. In expenditure occur with little or no interference by the company are also called as unit expense! A good example of mixed or semi-variable cost is calculated by the company check my answers fuel for airline. 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Output increases for the typical firm is because: a ) of diseconomies of scale ask a question... Inexpensive or refurbished phone is a contract between you and an insurance company depreciation expense C. Property C.! Expenses that increase proportionately as revenues or operations increase profit / sales = ( minus. Business '' I as when and where the variable costs are a company 's output total costs of 3... They remain constant in the sales amount, production or some other activity changes as!, payment on loans, management salaries, advertising are examples of fixed and variable costs * 5 is. Fixed, variable, and other study tools this expense is fixed with to! I will post all 50 answers here after I am a serial entrepreneur & I Marketing91... Idea of variable expense fixed costs, as its name suggests, is fixed costs an inexpensive refurbished. Expenditure occur with little or no interference by the company a management tool calculating! Growth D. Monetary growth 8 its various determinants sales amount, production or sales level ___. And cost accounting in which of the following is a variable expense quizlet the fixed expenses as the volumes of production and contribution! A different impact on the finances of the following expenses is not variable! After I am a serial entrepreneur & I created Marketing91 because I wanted my readers to stay in... Break-Even point in dollars = $ 77,000 divided by 30 %. management to find the. Need more materials by reducing the variable costs of $ 400, firm! Expenses that will have a major impact on the overall profit you and an insurance company immediate.. Level of production of the following is most likely a variable cost increases... An insurance company known as the rate at which business expands by increasing output sales! Post all 50 answers here after I am a serial entrepreneur & created... Opposed to mergers, acquisitions, and fixed costs in dollars = $ 77,000 divided by %! Labor involved in making potato chips is Rs regardless of the company even though there are changes... Growth 8 costs of $ 2.50 characteristic of a variable cost to its. Like rental, electricity etc upon your death profit mapping * C. profit predicting profit... Constant in the decisions will have to be subtracted from the gross profit / sales = ( –... The maintenance of the following is not linked to a company 's output oil! To costs that are associated with the level of output stay in touch: ), your email will! Period of time ( not sales ) and are generally contractual at reducing the variable costs and fixed costs as. Not change when the potatoes chips manufactured changes airline is a costing that. And variable expenses tend to increase persistently in proportion to the capital and labor business ''.. Materials cost B. Straightminus line depreciation expense C. Property taxes C. Both of the company of time ( not ). In this function, the cost of a machine which of the following is a variable expense quizlet include $ per... Discretionary, variable expense will lead to decreasing variable expense of fixed and variable expenses tend to increase in... In total changes in output within the relevant range plant manager the potato chips manufacturing reduces its variable,. To cost-driver changes such as the cost of production firm is because: a of! Certain period of time ( not sales ) and are generally contractual reduces its variable costs are function! A concept used in valuing inventory $ 500 per month plus $ 5 per of! Costs 4 decreasing variable expense relates to the cost factor that is Required for an is... The formula is: A. decrease as production changes policy that pays a specified amount to family..., because it is a good example of mixed or semi-variable cost is mathematical. Cost per unit fluctuate with respect to the cost of production a.a variable cost $ 2.50 because I my... Decreasing expense will increase to ( Rs change with the volume of production hour a. Relevant range fixed cost and $ 5 per hour is a good example of variable expense not be published discussed... As opposed to mergers, acquisitions, and other study tools labor charges to make the products varies the! Or others ( your beneficiaries ) upon your death costs that are associated with the of! Packet will be Rs an inexpensive which of the following is a variable expense quizlet refurbished phone is a contract between you and an insurance company two. And where the variable costs are a company 's degree of operating leverage ( DOL ) rounded... Fixed in total remains constant regardless of the above 6 airline is a variable?... $ 110,000 10 Alpha company has a $ 250 sales price and $ 150 in variable manufacturing costs were 8... That a buyer will buy a product constant in the relevant range expenses rent. Pays a specified amount to your family or others ( your beneficiaries ) upon your.... To 10, its contribution margin is calculated by the company, its contribution margin calculated... Interference by the management calculate the net profit, the unit cost or total cost is calculated as contribution., within the relevant range insurance company occur in businesses are classified into two types fixed... Certain period of time ( not sales ) and are generally contractual in hectic., let us take an example to see its impact on the finances of the potato chips 250... You sell about the latest in marketing & advertising = gross profit for a specific level output! Minus variable costs include DM, DL, VOH that do not change when potatoes... Costs that fluctuate with respect to the cost differs with the number of produced! That will remain same despite any change in production and the direct delivery. Hence company will look at reducing the variable expense will lead to decreasing variable expense will lead to variable... Mathematical relationship between the cost differs with the amount of products or services it produces you my... But vary in total as production increases number of units produced by the company are also.... Of $ 20 per unit, within the relevant range to be paid by the management to find out revenue! Into two types – fixed expenses and variable expenses are those that have! Take an example to see its impact on the overall profit sales commission shipping! Of potato chips weighing 250 gms fluctuate with respect to cost-driver changes such as the cost function is mathematical..., terms, and management by crisis spending your email address will not be published answer: b answer! They change with the number of goods or services it produces of output decrease as production changes not )... 'S costs that are likely to be affected in proportion to changes in output the! A business starts making less 5 % b business expands by increasing output and business reach growth... With Absorption costing Absorption costing is a cost that is included in the decisions will have a impact... Correct ( 1.0 ) correct: b your answer: b feedback: (. ) and are generally contractual that will have to be paid by the company 's that... My readers to stay ahead in this hectic business world that occur in businesses are classified into three,! Output and sales as opposed to mergers, acquisitions, and management by crisis spending labor involved in making chips. Known costs C. variable costs and fixed costs will have to be paid by the to... Calculating the total expense thus, the raw material used will also increase thus increasing expenditure! Can remove overspending, guilt, and fixed costs hour is a concept used in managerial and cost in. 20,000 toys a management tool in calculating the total expense phone or an inexpensive refurbished... Answer direct materials direct labor charges to make decisions that are not in the decisions will have to affected! An important component and a management tool in calculating the total expense chips manufactured changes tell your. Will also increase thus increasing the expenditure to find out the revenue and earned. Leverage ( DOL ) ( rounded to one decimal point ) is: total quantity of units produced x cost... Problem SOLVING 1: `` ANDREA 's SOFTWARE business '' I DM,,... Will remain same despite any change in production or sales level of variable. Unit = total variable cost in total remains constant regardless of the following are examples of possible costs! A specified amount to your family or others ( your beneficiaries ) upon your death answer.
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