ACCT 526 ULL Final Exam
Flashcards QUESTIONS AND
VERIFIED CORRECT
ANSWERS GRADED A+
LATEST 100% GUARANTEED
PASS
Break-even point - CORRECT ANSWER-Level where total revenue equals total cost
Margin of Safety Formula - CORRECT ANSWER-Actual Sales - Break-Even Sales
Degree of Operating Leverage - CORRECT ANSWER-CM / Net Operating Income
Break-even Formula (units) - CORRECT ANSWER-Fixed costs / Contribution margin per unit
Break-even Formula (sales) - CORRECT ANSWER-Fixed Costs / CM ratio
Target Income (Units) - CORRECT ANSWER-(Fixed Costs + Desired Profit) / CM per unit
Margin of Safety Ratio (formula) - CORRECT ANSWER-MOS / Actual sales
Degree of Leverage (formula) - CORRECT ANSWER-Contribution Margin / Net Operating Income
, Special Order Decision - CORRECT ANSWER-Accept if special price is greater or equal to variable
cost per unit and capacity exists
Make-or-Buy Decision - CORRECT ANSWER-Compare relevant internal cost vs. purchase price.
IGNORE SUNK COSTS
Product Line Elimination Decision - CORRECT ANSWER-Drop if avoided fixed costs > lost
contribution margin
Sales budget - CORRECT ANSWER-Starting point for all other budgets
Production budget formula - CORRECT ANSWER-Budgeted sales + Desired Ending Finished
Goods Inventory - Beginning Finished Goods
Production Cost Projections - CORRECT ANSWER-Built by use of DM, DL, and OH budgets
Cash Budget formula - CORRECT ANSWER-Beginning Cash + Receipts - Disbursements +/-
Financing
Cost Center - CORRECT ANSWER-Controls costs only. Does not generate revenue directly
Profit Center - CORRECT ANSWER-Responsible for revenues and costs
Investment Center - CORRECT ANSWER-Controls profits and assets
3 types of Responsibility Centers - CORRECT ANSWER-Cost center, profit center, investment
center
Flashcards QUESTIONS AND
VERIFIED CORRECT
ANSWERS GRADED A+
LATEST 100% GUARANTEED
PASS
Break-even point - CORRECT ANSWER-Level where total revenue equals total cost
Margin of Safety Formula - CORRECT ANSWER-Actual Sales - Break-Even Sales
Degree of Operating Leverage - CORRECT ANSWER-CM / Net Operating Income
Break-even Formula (units) - CORRECT ANSWER-Fixed costs / Contribution margin per unit
Break-even Formula (sales) - CORRECT ANSWER-Fixed Costs / CM ratio
Target Income (Units) - CORRECT ANSWER-(Fixed Costs + Desired Profit) / CM per unit
Margin of Safety Ratio (formula) - CORRECT ANSWER-MOS / Actual sales
Degree of Leverage (formula) - CORRECT ANSWER-Contribution Margin / Net Operating Income
, Special Order Decision - CORRECT ANSWER-Accept if special price is greater or equal to variable
cost per unit and capacity exists
Make-or-Buy Decision - CORRECT ANSWER-Compare relevant internal cost vs. purchase price.
IGNORE SUNK COSTS
Product Line Elimination Decision - CORRECT ANSWER-Drop if avoided fixed costs > lost
contribution margin
Sales budget - CORRECT ANSWER-Starting point for all other budgets
Production budget formula - CORRECT ANSWER-Budgeted sales + Desired Ending Finished
Goods Inventory - Beginning Finished Goods
Production Cost Projections - CORRECT ANSWER-Built by use of DM, DL, and OH budgets
Cash Budget formula - CORRECT ANSWER-Beginning Cash + Receipts - Disbursements +/-
Financing
Cost Center - CORRECT ANSWER-Controls costs only. Does not generate revenue directly
Profit Center - CORRECT ANSWER-Responsible for revenues and costs
Investment Center - CORRECT ANSWER-Controls profits and assets
3 types of Responsibility Centers - CORRECT ANSWER-Cost center, profit center, investment
center
