Accounting is a fundamental aspect of managing finances for individuals, businesses, and organizations. It involves the systematic recording, summarizing, and reporting of financial transactions to provide insights into an entity’s financial health and performance. Whether you’re a budding entrepreneur, a student learning the ropes, or simply curious about financial matters, understanding basic accounting principles is crucial. In this collection of questions and answers, we will delve into the fundamentals of accounting, covering topics such as the accounting equation, financial statements, double-entry accounting, and more. These fundamental concepts are the building blocks for more advanced accounting practices and are essential for making informed financial decisions. So, let’s embark on a journey to demystify the accounting world with these basic questions and their concise answers.

So, let’s get started with Basic Accounting Questions And Answers

### Question 1. For Your Sole sells specialized running insoles. They sell their insoles for $75 each. The company has determined the variable costs to be $30 per unit produced and $22,500 in monthly fixed expenses.

Using these numbers, calculate break-even points in units

**The correct answer is: 45**

### Question 2. For Your Sole sells specialized running insoles. They sell their insoles for $75 each. The company has determined the variable costs to be $30 per unit produced and $22,500 in monthly fixed expenses.

Using these numbers, calculate the break-even points in dollars

**The correct answer is: 37500**

### Question 3. For Your Sole sells specialized running insoles. They sell their insoles for $75 each. The company has determined the variable costs to be $30 per unit produced and $22,500 in monthly fixed expenses.

During the month of May, For Your Sole produced 900 insoles. Answer the following questions.

Determine the Sales

Type the answer with no comma

6750

One possible correct answer is: 67500

Determine the variable costs

Type the answer with no comma

2700

One possible correct answer is: 27000

Calculate the Contribution Margin

Type the answer with no comma

4050

One possible correct answer is: 40500

Determine the Fixed Costs

Type the answer with no comma

2250

One possible correct answer is: 22500

Calculate the Net Income

Type the answer with no comma

1800

**The correct answer is: 1800**

### Question 4. For Your Sole sells specialized running insoles. They sell their insoles for $75 each. The company has determined the variable costs to be $30 per unit produced and $22,500 in monthly fixed expenses.

In order to reach their target profit of $45,000, how many insoles will they need to sell?

Type your response with no commas

**The correct answer is: 1500**

### Question 5. For Your Sole sells specialized running insoles. They sell their insoles for $75 each. The company has determined the variable costs to be $30 per unit produced and $22,500 in monthly fixed expenses.

In order to reach their target profit of $45,000, what dollar sales will the company need?

Type the response with no commas.

**The correct answer is: 112500**

### Question 6. For Your Sole sells specialized running insoles. They sell their insoles for $75 each. The company has determined the variable costs to be $30 per unit produced and $22,500 in monthly fixed expenses.

During the month of July, the company had $150,000 in sales volume. Respond to the following.

Calculate the Sales

Type your response with no commas

1500

One possible correct answer is: 150000

Calculate the Variable Costs

Type your response with no commas

-600 X

One possible correct answer is: 60000

Calculate the Contribution Margin Type the answer with no comma

9000

One possible correct answer is: 90000

Determine the Fixed Costs

Type the answer with no comma

-2250 X

One possible correct answer is: 22500

Calculate the Net Income

Type the answer with no comma

6750

**One possible correct answer is: 67500Your answer is partially correct.You have correctly answered 3 part(s) of this question.**

### Question 7. H2O water softener company has the opportunity to purchase a new water distillery that will help them reduce their variable costs by $2 per unit. The purchase of the distillery will increase fixed costs by 15%. The following contribution margin income statement was prepared by H2O for the month of September.

H2O had the following income statement for the year ended 2022:

H2O

Contribution Margin Income Statement

For the Year Ended December 31, 2022

Sales ($75 per unit @1500 units)

Variable costs ($15 per unit @1500 units)

Contribution Margin

Fixed Costs

Net Income

112,500

22,500

90,000

40,000

50,000

Assuming H2O will purchase the equipment and their sales volume will remain unchanged, prepare a projected contribution margin income

statement.

Type your responses with no commas

Sales

Type in your response with no commas

1095 X

One possible correct answer is: 112500

Variable Costs

Type in your response with no commas

1950

One possible correct answer is: 19500

Contribution Margin

Type in your response with no commas

9000 X

One possible correct answer is: 93000

Fixed Costs

Type in your response with no commas

4600

One possible correct answer is: 46000

Net income (Loss)

Type in your response with no commas

4400 X

One possible correct answer is: 47000

**You have correctly answered 2 part(s) of this question.**