Questions:
1. An accountant may have difficulty classifying costs as fixed or variable because _____.
a. costs may behave in a nonlinear way
b. costs may be affected by more than one cost driver
c. the decision situation may cause the costs to be fixed in the short term
d. all of these answers are correct
2. If the proportions in a sales mix change, the _____.
a. contribution margin per unit increases
b. break even point will remain the same
c. cost volume profit relationship also changes
d. net income will not be altered
3. _____ will decrease a company's break-even point.
a. Reducing its total fixed costs
b. Decreasing contribution margin per unit
c. Increasing variable cost per unit
d. Decreasing the selling price per unit
4. Costs that change abruptly at intervals of activity because the resources and their costs come in indivisible chunks are called _____.
a. mixed costs
b. variable costs
c. fixed costs
d. step costs