Match the Items in the Two Columns Below by Entering

question 109

Short Answer

Match the items in the two columns below by entering the appropriate code letter in the space provided.
A. Activity index
B. Variable costs
C. Fixed costs
D. High-low method
E. Relevant range
F. Mixed costs
G. Break-even point
H. Contribution margin
I. Margin of safety
J. Contribution margin ratio
____ 1. The amount of revenue remaining after deducting variable costs.
____ 2. Costs that contain both a variable and a fixed element.
____ 3. The percentage of sales dollars available to cover fixed costs and produce income.
____ 4. Identifies the activity which causes changes in the behavior of costs.
____ 5. The difference between actual or expected sales and sales at the break-even point.
____ 6. Costs that vary in total directly and proportionately with changes in the activity level.
____ 7. The level of activity at which total revenues equal total costs.
____ 8. The range over which the company expects to operate during the year.
____ 9. Costs that remain the same in total regardless of changes in the activity level.
____ 10. A method that uses the total costs incurred at the high and low levels of activity.

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Definitions:

Present Value

The current worth of a future sum of money or stream of cash flows given a specified rate of return, often used in evaluating investment opportunities.

Interest Rate

The ratio of interest charged on a loan to the borrower, usually represented as a yearly percentage of the remaining loan amount.

Compound Interest

Calculating interest that includes both the original principal amount and all previously accumulated interest on a loan or deposit.

Simple Interest

The method of calculating interest charges based on the principal amount only, not compounding on accumulated interest.