CBAD 202 Exam 2 questions with
verified solutions
A contribution margin income statement allows managers to see which costs will change with changes in
volume and which costs will remain fixed. - correct answer ✔✔True
When graphing total fixed costs, the fixed cost per unit is the slope of the fixed cost line. - correct answer
✔✔False
When graphing total variable costs, the cost line begins at the origin. - correct answer ✔✔True
Manufacturing overhead (consisting of costs like factory rent, factory utilities, factory maintenance, and
other similar costs) is usually what type of cost? - correct answer ✔✔Mixed
A plantwide overhead rate is calculated by dividing the estimated total manufacturing overhead costs for
the year by estimated total amount of the allocation base for the year. - correct answer ✔✔True
When using the high-low method, the "high" point should be chosen as the data point with the highest
cost (not the highest volume). - correct answer ✔✔False
The variable cost per unit of activity increases as activity increases. - correct answer ✔✔False
The contribution margin income statement presents ________ below the contribution margin line. -
correct answer ✔✔all fixed expenses
Which of the following costs is an example of a fixed cost? - correct answer ✔✔Salary of plant manager
Contribution margin income statements organize costs by behavior. - correct answer ✔✔True
verified solutions
A contribution margin income statement allows managers to see which costs will change with changes in
volume and which costs will remain fixed. - correct answer ✔✔True
When graphing total fixed costs, the fixed cost per unit is the slope of the fixed cost line. - correct answer
✔✔False
When graphing total variable costs, the cost line begins at the origin. - correct answer ✔✔True
Manufacturing overhead (consisting of costs like factory rent, factory utilities, factory maintenance, and
other similar costs) is usually what type of cost? - correct answer ✔✔Mixed
A plantwide overhead rate is calculated by dividing the estimated total manufacturing overhead costs for
the year by estimated total amount of the allocation base for the year. - correct answer ✔✔True
When using the high-low method, the "high" point should be chosen as the data point with the highest
cost (not the highest volume). - correct answer ✔✔False
The variable cost per unit of activity increases as activity increases. - correct answer ✔✔False
The contribution margin income statement presents ________ below the contribution margin line. -
correct answer ✔✔all fixed expenses
Which of the following costs is an example of a fixed cost? - correct answer ✔✔Salary of plant manager
Contribution margin income statements organize costs by behavior. - correct answer ✔✔True
