Accounting

Once the breakeven point is reached:

- the total contribution margin changes from negative to positive.

- net operating income will increase by the unit contribution margin for each additional item sold.

- variable expenses will remain constant in total.

- the contribution margin ratio begins to decrease.

net operating income will increase by the unit contribution margin for each additional item sold.

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Which of the following is true regarding the contribution margin ratio of a single product company?

- As fixed expenses decrease, the contribution margin ratio increases.

- The contribution margin ratio multiplied by the variable expense per unit equals the contribution margin per unit.

- If sales increase, the dollar increase in net operating income can be computed by multiplying the contribution margin ratio by the dollar increase in sales.

- The contribution margin ratio increases as the number of units sold increases.

If sales increase, the dollar increase in net operating income can be computed by multiplying the contribution margin ratio by the dollar increase in sales.

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Assuming that the unit sales are unchanged, the total contribution margin will decrease if:

- fixed expenses increase.

- fixed expenses decrease.

- variable expense per unit increases.

- variable expense per unit decreases.

variable expense per unit increases.

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To obtain the breakeven point in terms of dollar sales, total fixed expenses are divided by which of the following?

- Variable expense per unit.

- Variable expense per unit/Selling price per unit.

- Fixed expense per unit.

- (Selling price per unit Variable

expense per unit)/Selling price per unit.

(Selling price per unit Variable

expense per unit)/Selling price per unit.

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A company increased the selling price for its product from $5 to $6 per unit when total fixed expenses increased from $100,000 to $200,000 and variable expense per unit remained unchanged. How would these changes...