1. Contribution margin: a. is revenue remaining after deducting variable cost. b. both a and c. c. may be expressed as contribution margin per unit. d. is selling price less cost of goods sold. 2. Goltiao company sells 100 000 wrenches for $ 12 a unit. Fixed cost are $ 300 000, and net income is $ 200 000. What should be reported as variable expenses in the CVP income statement? a. $ 900 000 b. $ 700 000 c. $ 500 000 d. $ 250 000 3. Ladiao company is planning to sell 200 000 flyers for $ 4 per unit. The contribution margin ratio is 25%. If Ladiao will break-even at this level of sales, what are the fixed costs? a. $ 960 000 b. $ 160 000 c. $ 100 000 d. $ 200 000 4. Caliao Corporation has fixed costs of $ 180 000 and variable costs of $ 8.50 per unit. It has a target income of $ 268 000. How many units must it sell at $ 12 per unit to achieve it's target net income? a. 514 290 units b. 128 000 units c. 765 781 units d. 987 654 units 5. Bruses company has actual sales of $ 600 000 when break-even sales were $ 420 000. What is the margin of safety? a. $ 239 098 b. $ 180 000 c. $ 90 000 d. $ 432 980
