effective compared to the red sofa. Diff: 3 LO: 2-6 EOC: P2-45A AACSB: Analytical thinking Learning Outcome: Define and use cost-volume-profit analysis to analyze the effects of changes in costs and volume on a company's profits. 245) Variable costs per unit decrease as production volume increases. Answer: FALSE Diff: 1 LO: 2-7 EOC: S2-15 AACSB: Reflective thinking Learning Outcome: Define and use cost-volume-profit analysis to analyze the effects of changes. 246) Fixed costs vary in total over a wide range of activity levels. Answer: FALSE Diff: 1 LO: 2-7 EOC: S2-15 AACSB: Reflective thinking Learning Outcome: Define and use cost-volume-profit analysis to analyze the effects of changes. 247) All costs contain both a fixed and a variable portion. Answer: FALSE Diff: 2 LO: 2-7 EOC: S2-15 AACSB: Reflective thinking Learning Outcome: Define and use cost-volume-profit analysis to analyze the effects of changes. 248) The total cost of a product equals the total fixed costs plus the total variable costs. Answer: TRUE Diff: 2 LO: 2-7 EOC: S2-15 AACSB: Reflective thinking Learning Outcome: Define and use cost-volume-profit analysis to analyze the effects of changes. 249) A marginal cost is the cost of making one more unit of a product. Answer: TRUE Diff: 2 LO: 2-7 EOC: S2-15 AACSB: Reflective thinking Learning Outcome: Define and use cost-volume-profit analysis to analyze the effects of changes. 250) To forecast total costs at a given level of production, management would use which of the following calculations? A) Average cost × total units predicted
effective compared to the red sofa. Diff: 3 LO: 2-6 EOC: P2-45A AACSB: Analytical thinking Learning Outcome: Define and use cost-volume-profit analysis to analyze the effects of changes in costs and volume on a company's profits. 245) Variable costs per unit decrease as production volume increases. Answer: FALSE Diff: 1 LO: 2-7 EOC: S2-15 AACSB: Reflective thinking Learning Outcome: Define and use cost-volume-profit analysis to analyze the effects of changes. 246) Fixed costs vary in total over a wide range of activity levels. Answer: FALSE Diff: 1 LO: 2-7 EOC: S2-15 AACSB: Reflective thinking Learning Outcome: Define and use cost-volume-profit analysis to analyze the effects of changes. 247) All costs contain both a fixed and a variable portion. Answer: FALSE Diff: 2 LO: 2-7 EOC: S2-15 AACSB: Reflective thinking Learning Outcome: Define and use cost-volume-profit analysis to analyze the effects of changes. 248) The total cost of a product equals the total fixed costs plus the total variable costs. Answer: TRUE Diff: 2 LO: 2-7 EOC: S2-15 AACSB: Reflective thinking Learning Outcome: Define and use cost-volume-profit analysis to analyze the effects of changes. 249) A marginal cost is the cost of making one more unit of a product. Answer: TRUE Diff: 2 LO: 2-7 EOC: S2-15 AACSB: Reflective thinking Learning Outcome: Define and use cost-volume-profit analysis to analyze the effects of changes. 250) To forecast total costs at a given level of production, management would use which of the following calculations? A) Average cost × total units predicted