Answer the Following Questions Using the Information Below

question 182

Multiple Choice

Answer the following questions using the information below:
Nancy's Niche sells a single product. 8,000 units were sold resulting in $80,000 of sales revenue, $20,000 of variable costs, and $10,000 of fixed costs.
-If a change is made in one parameter of CVP analysis, it is an example of:

• A)sensitivity analysis
• B)incremental budgeting
• C)operating leverage
• D)multiple cost drivers

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Definitions:

Processing Time

The amount of time required to complete a specific task or operation in a manufacturing or processing environment.

Lot-For-Lot

An inventory management technique where the order quantity matches the exact demand for the upcoming period.

EOQ Lot-Sizing

A quantitative model used in inventory management for determining the optimal order quantity that minimizes total inventory costs.

Gross Requirements

The total demand for a product or component before taking into account inventory on hand or any scheduled receipts.