Answer – Contrbution Analysis

Contribution Analysis

The answers are below:

(1) Boreland should employ which of the following accounting principles?

  • (a) Restitution Calibration
  • (b) Transactional Analysis
  • (c) Constitutional Analysis
  • (d) Contribution Analysis  

(4) True or False, generally speaking Contribution Analysis identifies overhead costs by accounting for all known fixed, direct and variable costs and then subtracting that amount from revenues.

  • (1) D, Contribution Analysis.
  • (2) D, All of the above.
  • (3) D, All of the above.
  • (4) True, although other variations may be employed.

    (2) To calculate a products contribution to profits, Boreland will need to assemble which of the following data?

    • (a) Number of units sold
    • (b) Contribution margin per unit
    • (c) Price records
    • (d) Variable costs per unit
    • (e) All of the above

    (3) Which of the following are potential benefits Boreland might realize as a result of      employing a Contribution Analysis?

  • (a) Identifying previously unkown costs
  • (b) Assisting in categorizing costs
  • (c) Guidance in setting a prices for totally new projects
  • (d) All of the above