23. Small Company, a producer of auto components, has the following information: Income tax rate 20% Selling price...

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23. Small Company, a producer of auto components, has thefollowing information:
Income tax rate 20%
Selling price per unit $9.00
Variable cost per unit $4.00
Total fixed costs $150,000.00
The break-even point in units is .
A) 15,000 units.
B) 30,000 units.
C) 45,000 units.
D) 60,000 units.
24. If the total amount of fixed costs increases, what is theeffect on the break-even point? (Assume no other changes.)
A) The break-even point decreases.
B) The break-even point remains the same.
C) The break-even point is zero.
D) The break-even point increases.
25. Cost drivers are .
A) the different functions in the value chain
B) different types of functional areas in the firm
C) different types of cost calculations
D) measures of activities that require the use of resources andthereby cause costs
26. Assume NEIU Company has the following informationavailable:
Selling price per unit $100
Variable cost per unit $50
Fixed costs per year $250,000
Expected sales per year (units) 7,500
If fixed costs increase by $50,000, what is the break-even pointin units?
A) 3,000
B) 4,000
C) 5,000
D) 6,000
27. The use of high technology equipment to manufacture productsinstead of highly skilled labor usually results in .
A) higher discretionary fixed costs
B) higher discretionary variable costs
C) higher operating leverage
D) lower risk

Answer & Explanation Solved by verified expert

3.8 Ratings (769 Votes)

Question 23 Correct Answer b 30000 units Calculations A Selling price per unit 900 B Variable cost per unit 400 CAB Contribution margin per unit 500 D Fixed Cost 15000000 EDC Breakeven units 30000 Question 24 Correct AnswerBreakeven point Increases Explanation Take See Answer

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23. Small Company, a producer of auto components, has thefollowing information:Income tax rate 20%Selling price per unit $9.00Variable cost per unit $4.00Total fixed costs $150,000.00The break-even point in units is ________.A) 15,000 units.B) 30,000 units.C) 45,000 units.D) 60,000 units.24. If the total amount of fixed costs increases, what is theeffect on the break-even point? (Assume no other changes.)A) The break-even point decreases.B) The break-even point remains the same.C) The break-even point is zero.D) The break-even point increases.25. Cost drivers are ________.A) the different functions in the value chainB) different types of functional areas in the firmC) different types of cost calculationsD) measures of activities that require the use of resources andthereby cause costs26. Assume NEIU Company has the following informationavailable:Selling price per unit $100Variable cost per unit $50Fixed costs per year $250,000Expected sales per year (units) 7,500If fixed costs increase by $50,000, what is the break-even pointin units?A) 3,000B) 4,000C) 5,000D) 6,00027. The use of high technology equipment to manufacture productsinstead of highly skilled labor usually results in ________.A) higher discretionary fixed costsB) higher discretionary variable costsC) higher operating leverageD) lower risk