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If the Fixed Costs for a Product Decrease and the Variable

Question 24

Multiple Choice

If the fixed costs for a product decrease and the variable costs (as a percentage of sales dollars) decrease, what will be the effect on the contribution margin ratio and the break-even point, respectively?
 Contribution Margin Ratio  Break-even Point \begin{array}{cc}\text { Contribution Margin Ratio }&\text { Break-even Point }\end{array}
A.  Decrease  Increase \begin{array}{cc} &&& \text { Decrease } &&&&&&& \text { Increase } \\\end{array}
B.  Increase  Decrease \begin{array}{cc} &&& \text { Increase } &&&&&&& \text { Decrease } \\\end{array}
C.  Decrease  Decrease \begin{array}{cc}&&& \text { Decrease } &&&&&&& \text { Decrease } \\\end{array}
D.  Increase  Increase \begin{array}{cc}&&& \text { Increase } &&&&&&& \text { Increase } \\\end{array}


A) Option A
B) Option B
C) Option C
D) Option D

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