In Contribution Margin Analysis,the Unit Price or Unit Cost Factor

question 65

Multiple Choice

In contribution margin analysis,the unit price or unit cost factor is computed as:

• A) the difference between the actual unit price or unit cost and the planned unit price or cost,multiplied by the planned quantity sold
• B) the difference between the actual unit price or unit cost and the planned unit price or cost,multiplied by the actual quantity sold
• C) the difference between the actual quantity sold and the planned quantity sold,multiplied by the planned unit sales price or unit cost
• D) the difference between the actual quantity sold and the planned quantity sold,multiplied by the actual unit sales price or unit cost

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Definitions:

First-In, First-Out

An inventory valuation method where the oldest stock is sold or used first.

Weighted-Average Methods

An inventory costing method that calculates the cost of goods sold and ending inventory based on the average cost of all units available during the period.

First-In, First-Out

An inventory valuation method where the oldest items are sold or used first.

Equivalent Units

A concept in cost accounting used to assess work-in-process inventory by converting partial units into a number of equivalent full units.