Questions from Cost Accounting

Q: Write out the equation for the target volume (in units)

Write out the equation for the target volume (in units) profit equation when the income tax rate is t.

Q: What do the terms step costs and semivariable costs mean?

What do the terms step costs and semivariable costs mean?

Q: How do income taxes affect the break-even equation? Why

How do income taxes affect the break-even equation? Why?

Q: Why is it common to assume a fixed sales mix before finding

Why is it common to assume a fixed sales mix before finding the break-even volume with multiple products?

Q: What are the components of total costs in the profit equation?

What are the components of total costs in the profit equation?

Q: How does the total contribution margin differ from the gross margin that

How does the total contribution margin differ from the gross margin that is often shown on companies’ financial statements?

Q: Compare cost-volume-profit (CVP) analysis with profit

Compare cost-volume-profit (CVP) analysis with profit-volume analysis. How do they differ?

Q: Fixed costs are often defined as “fixed over the short run

Fixed costs are often defined as “fixed over the short run.” Does this mean that they are not fixed over the long run? Why or why not?

Q: Freeflight Airlines is presently operating at 70 percent of capacity. Management

Freeflight Airlines is presently operating at 70 percent of capacity. Management of the airline is considering dropping Freeflight’s routes between Europe and the United States. If t...

Q: CompDesk, Inc., makes a single model of an ergonomic desk

CompDesk, Inc., makes a single model of an ergonomic desk (with chair) for computer usage. The desk is manufactured in building 1, and the chair is manufactured in building 2. Monthly capacities and p...