LO 2-1

Identify and describe fixed, variable, and mixed cost behavior.

LO 2-2

Demonstrate the effects of operating leverage on profitability.

LO 2-3

Prepare an income statement using the contribution margin approach.

LO 2-4

Calculate the magnitude of operating leverage.

LO 2-5

Select an appropriate time period for calculating the average cost per unit.

LO 2-6

Use the high-low method, scattergraphs, and regression analysis to estimate fixed and variable costs.