1. The FIFO method only provides a major advantage over the weighted-average method in that (Points : 6)
a. the calculation of equivalent units is less complex under the FIFO method.
b. the FIFO method treats units in the beginning inventory as if they were started and completed during the current period.
c. the FIFO method provides measurements of work done during the current period.
d. the weighted-average method ignores units in the beginning and ending work-in-process inventories.
2. The contribution margin equals (Points : 6)
a. sales - expenses.
b. sales - cost of goods sold.
c. sales - variable costs.
d. sales - fixed costs.
I got fixed costs?
3. The unit sales needed to attain the target profit is found by:
a. dividing fixed costs by the contribution margin.
b. adding variable expenses to fixed expenses and dividing the total by the contribution margin.
c. adding target profit to the fixed expenses and then dividing the total by the unit contribution margin.
d. adding target profit to the fixed expenses and then dividing the total by the contribution margin.
4. In an income statement prepared using the variable costing method, variable selling and administrative expenses would:
a. be used in the computation of the contribution margin.
b. be used in the computation of net operating income but not in the computation of the contribution margin.
c. be treated differently from variable manufacturing expenses.
d not be used.
a. the calculation of equivalent units is less complex under the FIFO method.
b. the FIFO method treats units in the beginning inventory as if they were started and completed during the current period.
c. the FIFO method provides measurements of work done during the current period.
d. the weighted-average method ignores units in the beginning and ending work-in-process inventories.
2. The contribution margin equals (Points : 6)
a. sales - expenses.
b. sales - cost of goods sold.
c. sales - variable costs.
d. sales - fixed costs.
I got fixed costs?
3. The unit sales needed to attain the target profit is found by:
a. dividing fixed costs by the contribution margin.
b. adding variable expenses to fixed expenses and dividing the total by the contribution margin.
c. adding target profit to the fixed expenses and then dividing the total by the unit contribution margin.
d. adding target profit to the fixed expenses and then dividing the total by the contribution margin.
4. In an income statement prepared using the variable costing method, variable selling and administrative expenses would:
a. be used in the computation of the contribution margin.
b. be used in the computation of net operating income but not in the computation of the contribution margin.
c. be treated differently from variable manufacturing expenses.
d not be used.
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