If Variable Costs Per Unit Increased Because of an Increase

question 45

Multiple Choice

If variable costs per unit increased because of an increase in hourly wage rates, the break-even point would

• A) decrease
• B) increase
• C) remain the same
• D) increase or decrease, depending on the percentage increase in wage rates

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Definitions:

Lean Environment

A management philosophy focusing on minimizing waste within manufacturing systems while simultaneously maximizing productivity.

Raw and In Process Inventory

Items and materials that are either awaiting use in production or currently being manufactured.

Controlling Quality Costs

The process of managing and reducing the expenses associated with ensuring the quality of products or services.

Prevention Costs

Costs incurred to prevent defects before or during the manufacture of a product or the delivery of a service.