Management Accounting - Study Mode
[#241] Break-even point is also known as . . . . . . . . point.
Correct Answer
(C) no profit no loss
[#242] Why is profit volume ratio used? 1. To compute the variable cost for any volume of sales. 2. To determine break-even point and the level of output required to earn a desired profit. 3. To decide most profitable sales mix. Select the correct answer:
Correct Answer
(D) All of the above
[#243] An estimated cost per unit in long run, which enables company to achieve it's per unit target, operating income is classified as
Correct Answer
(B) target cost per unit
Explanation
Solution: An estimated cost per unit in long run, which enables company to achieve it's per unit target, operating income is classified as target cost per unit. The target cost of a product is the expected selling price of the product minus the desired profit from selling it. In other words, target cost is really a measure of how low costs need to be to make a certain profit.
[#244] Concept, which states that resources are used to meet particular goals is
Correct Answer
(A) cost incurrence
Explanation
Solution: Concept, which states that resources are used to meet particular goals is cost incurrence. Cost incurrence refers to the receipt of goods or services at a bargained price in an exchange.
[#245] Target price is subtracted from per unit target operating income to calculate
Correct Answer
(D) target cost per unit
Explanation
Solution: Target price is subtracted from per unit target operating income to calculate target cost per unit. The target cost of a product is the expected selling price of the product minus the desired profit from selling it. In other words, target cost is really a measure of how low costs need to be to make a certain profit.