Homework Answers
| 7-45) | |||
| 1) Break even sales volume (in tubs) | |||
| Model | Economy | Regular | Super |
| Selling price per tub | 1.75 | 1.75 | 1.75 |
| Less:Variable costs | |||
| Popcorn cost | 0.13 | 0.13 | 0.13 |
| Other costs | 1.22 | 1.14 | 1.05 |
| tub cost | 0.08 | 0.08 | 0.08 |
| Total Variable cost per tub | 1.43 | 1.35 | 1.26 |
| Contribution, A | 0.32 | 0.4 | 0.49 |
| Fixed Cost, B | 8000 | 11000 | 20000 |
| Break even sales volume, B/A | 25000 | 27500 | 40816.33 |
| 2) Attached sheet | |||
| 3) Let the volume is 'x' where Economy & Regular Propper earn | |||
| the same profit: | |||
| 0.32*x - 8000 = 0.4*x - 11000 | |||
| 0.4*x - 0.32*x = 11000 - 8000 | |||
| 0.08 x = 3000 | |||
| x = 3000/0.08 = 37500 tubs | |||
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Required information Problem 7-45 Break-Even Analysis: Profit-Volume Graph; Movie Theaters (LO 7-1,7-3, 7-4) Silver Screen Inc....
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Problem 7-51 Cost-Volume-Profit Analysis with Income Taxes and Multiple Products (Appendix) (LO 7-1, 7- 2, 7-4, 7-5, 7-11) [The following information applies to the questions displayed below) Alpine Thrills Ski Company recently expanded its manufacturing capacity. The firm will now be able to produce up to 28,000 pairs of cross-country skis of either the mountaineering model or the touring model. The sales department assures management that it can sell between 22.000 and 26,000 units of either product this year Because...
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Required information Problem 3-23A Comprehensive CVP analysis LO 3-3, 3-4, 3-5 [The following information applies to the questions displayed below.] Benson Company makes and sells products with variable costs of $41 each. Benson incurs annual fixed costs of $27,300. The current sales price is $62. Problem 3-23A Part a Required The following requirements are interdependent. For example, the $6,300 desired profit introduced in Requirement calso applies to subsequent requirements. Likewise, the $53 sales price introduced in Requirement d applies to...
Problem 3-17A (Algo) Determining the break-even point and preparing a contribution margin income statement LO 3-1 Ritchie Manufacturing Company makes a product that it sells for $200 per unit. The company incurs variable manufacturing costs of $101 per unit. Variable selling expenses are $19 per unit, annual fixed manufacturing costs are $464,000, and fixed selling and administrative costs are $256,000 per year. Required Determine the break-even point in units and dollars using each of the following approaches: a. Use the...
Required information Problem 3-23A Comprehensive CVP analysis LO 3-3, 3-4, 3-5 [The following information applies to the questions displayed below.] Benson Company makes and sells products with variable costs of $41 each. Benson incurs annual fixed costs of $27.300. The current sales price is $62. Problem 3-23A Part a Required The following requirements are interdependent. For example, the $6,300 desired profit introduced in Requirement calso applies to subsequent requirements. Likewise, the $53 sales price introduced in Requirement d applies to...
2 2 41 5 | Break-even analysis attempts to determine the volume of sales necessary for a manufacturer to cover costs, or to make revenue equal costs. It is helpful in setting prices, estimating profit or loss potentials, and determining the discretionary costs that should be incurred. The general formula for calculating break-even units is: Break-even = (Total Fixed Costs) / (Unit Selling Price - Unit Variable Cost] In StratSim; total fixed costs can be broken into discretionary marketing expenditures,...
Problem 4-31 Changes in Cost Structure; Break-Even Analysis; Indifference (L04, LOS, LO6] Patterson Products Inc. is considering an upgrade to its manufacturing equipment. The two upgrade options under consideration are shown below. Direct material cost per unit Direct labour cost per unit Variable overhead per unit Fixed manufacturing costs Option 1 61.2 48 13.2 $ 2,070,000 Option 2 $ 40.8 $ 41 $ 33.8 $ 4,008,000 The selling price of the company's product is $204 per unit with variable selling...
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