# MGMT 640 MGMT640 Quiz 9 Answers (MD)

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MGMT 640 Quiz 9

Question 1

Thomas Train has collected the following information over the last six months.

Month March April May June July August

Units produced 10,000 12,000 18,200 13,000 12,000 15,000

Total costs \$25,600

26,200 28,000 26,450 26,000 26,500

Using the high-low method, what is the variable cost per unit?

Question 2

Rooter's Cleaning Services provided data concerning the costs incurred to clean hotel rooms for which hotel customers pay \$150 per night. Data for the past 7 months are as follows:

How much are estimated monthly variable costs using the high-low method?

Question 3

A cost is \$3,600 at 1,000 units, \$7,000 at 2,000 units, and \$9,200 at 3,000 units. This cost is a

Question 4

Winny's Office Furniture has a contribution margin ratio of 16%. If fixed costs are \$187,800, how many dollars of revenue must the company generate in order to reach the break-even point?

Question 5

Tim Taylor has written a self improvement book that has the following cost characteristics:

Selling Price
Variable cost per unit: Production
Production

How many units must be sold to break-even?

Question 6

The use of fixed cost to increase profits at a rate faster than sales increase is called:

Question 7

Assume Sparkle Co. expects to sell 150 units next month. The unit sales price is \$90, unit variable cost is \$45, and the fixed costs per month are \$5,000. The margin of safety is:

Question 8

Which of the following statements about the relevant range is true?

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