Examlex

Solved

Use the Following Information for the Next 5 Questions

question 79

Multiple Choice

Use the following information for the next 5 questions.
SXF sells its single product for $14 per unit, and its variable cost per unit is $4. Total fixed costs are $800. Its CVP graph is as follows:
Use the following information for the next 5 questions. SXF sells its single product for $14 per unit, and its variable cost per unit is $4. Total fixed costs are $800. Its CVP graph is as follows:    -If SXF increases its sales volume by 10%, what will happen to its margin of safety? A)  It will decrease B)  It will increase C)  It will stay the same D)  Cannot be determined
-If SXF increases its sales volume by 10%, what will happen to its margin of safety?


Definitions:

Manufacturing Overhead

Expenses related to the manufacturing process that are not directly attributed to individual units produced, such as maintenance and factory supervision.

Machine-Hours

A measure of the time a machine is operated, used as a basis for allocating manufacturing overhead in some costing systems.

Predetermined Overhead Rate

A calculated rate designed for allocating manufacturing overhead expenses to specific production units, based on a selected activity base.

Manufacturing Overhead

All indirect costs associated with manufacturing, excluding direct materials and direct labor costs. These costs include indirect materials, indirect labor, and other expenses.

Related Questions