Explanation not necessary Which of the following represents the components of the income statement for a service business? A. Service Revenue - Operating Expenses = operating income B. Sales Revenue - Cost of Goods Manufactured = gross profit C. Sales Revenue - Cost of Goods Sold = gross profit D. Service Revenue - Cost of Goods Purchased = gross profit Fixed costs are expenses that A. vary in response to changes in activity level B. remain constant as activity changes C. remain constant on a per-unit basis D. increase on a per-unit basis as activity increases Variable costs are expenses that A. remain constant on a per-unit basis and remain constant in total regardless of activity level B. decrease on a per-unit basis as activity level increases C. remain constant on a per-unit basis but change in total based on activity level D. remain constant in total regardless of activity level within a relevant range Conversion costs include all of the following except: A. depreciation on factory equipment B. factory utilities C. wages of production workers D. direct materials purchased In the cost equation $Y = a + bx$, Y represents which of the following? A. units of production B. variable costs C. total costs D. fixed costs
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Which of the following represents the components of the income statement for a service business? A. Service Revenue - Operating Expenses = operating income B. Sales Revenue - Cost of Goods Sold = gross profit C. Sales Revenue - Cost of Goods Sold = gross profit D. Show more…
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Any cost that remains unchanged as output changes represents a firm's A. marginal cost. B. opportunity cost. C. fixed cost. D. variable cost. Any cost that changes as output changes represents a firm's A. sunk cost. B. overhead cost. C. fixed cost. D. variable cost. Which of the following is most likely to be a fixed cost for a farmer? A. wages paid to farm workers B. cost of fertilizer C. insurance premiums on property D. cost of seeds Which of the following is most likely to a variable cost for a business firm? A. property taxes B. rent on the office building C. interest on long-term outstanding bonds D. cost of shipping products
Manasvee S.
1. a. Assume that your employer is a manufacturing firm that produces several different electronic consumer products. What are four nonmonetary factors (attributes that may be important when a significant change is considered in the design of the current best selling product? [2] b. Classify each of the following cost items as mostly fixed or variable. Give appropriate reason as well. [2] Raw materials Direct labor Depreciation Property taxes c. A plant operation has fixed cost of $2,000,000 per year, and its output capacity is 100,000 electrical appliances per year. The variable cost is $40 per unit, and the product sells for $90 per unit. i. Construct the economic breakeven chart and determine the breakeven quantity and dollar breakeven point. ii. Compare annual profit when the plant is operating at 100% capacity. Assume that the first 90% of capacity output is sold at $90 per unit and that the remaining 10% of production is sold at $70 per unit [3] d. You are planning to build a new home with approximately 2,000-2,500 gross square feet of living space on one floor. In addition, you are planning an attached two-car garage (with storage space) of approximately 450 gross square feet. Develop a cost and revenue structure for designing and constructing, operating (occupying) for 10 years, and then selling the home at the end of the 10th year. [3]
If at its current production level, a perfectly competitive firm's marginal revenue and long-run marginal cost are equal to $0.50 and its long-run average cost is $0.35, which of the following statements is true? A. The firm should expect the market price of its product to fall. B. The firm should expect to earn positive economic profit indefinitely. C. The firm should expect the market supply curve to decrease. D. The firm should expect the market price of its product to increase.
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