ROGERS 1:47 PM 37% і Done tb03.docx 31. If sales are $80,000, variable costs are $50,000,...
82. Dundas Inc. manufactures a single product. The product sells for $10. The variable manufacturing cost per unit is $2 and the variable selling cost is $2 per unit. Dundas incurs monthly fixed costs of $100,000 for manufacturing and $140,000 for administration and selling If Dundas raises its selling price by 10% in response to a 10% increase in variable costs, and income taxes are 40%, its new breakeven point in sales dollars (relative to that of the original data...
76. A firm selling three products has the following data: Unit Unit Variable Product Sales Mix Price Cost 60,000 units $40 S20 40,000 units 60 30 20,000 units 30 5 If the firm can change the sales mix from 60,000 P, 40,000 Q, and 20,000 R to 60,000 P, 20,000 Q, and 40,000 R, pre-tax income will be a) Lower b) Higher c) Unchanged d) Cannot be determined Answer: a Difficulty: Medium Learning Objective: Apply CVP calculations for multiple products....
95. Ferguson Co. incurs $568,000 in fixed costs while producing three products with the following characteristics: Sales Mix Unit Product (Units) $900 600 35% What is the breakeven point in units? a) 400 b) 240 c) 299 d) 800 Answer: d Difficulty: Medium Learning Objective: Apply CVP calculations for multiple CPA: Management Accounting 96. Ferguson Co. incurs $568,000 in fixed costs while producing three products with the following characteristics: Sales Mix Unit Product (Units) $900 600 400 45% At the...
39. The Puppet Co. has the following unit and mix data: Dah To $4.00 0.6 20% $5.00 Unit sales price Unit contribution margin Sales mix (S) Fixed costs Target 0.75 $99,000 24.750 How many units of Dah must be sold at the breakeven point? a) 75,000 b) 27,500 c) 37,500 d) 55,000 Answer: b Difficulty: Easy Learning Objective: Apply CVP calculations for a single CPA: Management Accounting 40. The Puppet Co. has the following unit and mix data: Dah To...
52. The cost function for Ciao Company is: TC $800+0.375 Revenue. If Ciao expects after-tax income of $600, and the tax rate is 40%, what is the firm's margin of safety? a) $3,680 b) $2,400 c) $2,880 d) $1,600 Answer: d Difficulty: Hardard Learning Objective: Assess operational risk using margin of safety and operating leverage CPA: Management Accounting 53. Terry's Donut Shop had the following activity for Total donuts sold 17,000 Total revenues $595,000 Total fixed costs 99.000 Total variable...
35. PhotoMix Corporation produces three products. Cost, price, and volume data is shown below: Total Fixed costs $2.400 Tax rate 40% Candle Holders Holders Holders Normal volume Price per unit Variable cost per unit 150 $5 $10 3 2 When using units as the measure, what proportion of the sales mix do picture holders represent? Round to the nearest whole percent. a) 33% b) 46% c) Some other percentage d) Cannot be determined Answer: b Difficulty: Easy Learning Objective: Explain...
65, Chisholm Co. has a contribution margin ratio of 40% and a breakeven point of $200,000 in sales. If the firm reports net income of $50,000 after taxes of 50%, what were total sales for the year? a) $450,000 b) $466,667 c) $500,000 d) $700,000 Answer: a Difficulty: Medium Learning Objective: Apply CVP calculations for a single CPA: Management Accounting 66. If the total contribution margin decreases and fixed costs do not change, pre-tax income a) Decreases by an equal...
68. Data extracted from the accounting information system of Turner Corporation produced the following graph. The equation of the dashed line is y $25x; the equation of the solid line is y $200 $5x. 600 $500 400 $300 200 $100 The solid line represents: a) Total variable costs b) Total fixed costs c) Total costs d) Total revenues Answer: C Difficulty: Easy Learning Objective: Apply CVP calculations for a single CPA: Management Accounting 69. Data extracted from the accounting information...
60. Smith Company is attempting to develop the cost function for repair costs. The following past data are available: Machine Hours 4,800 3,400 4,000 5,900 Repair Costs $6,385 4,585 5,285 7,085 Using the high-low method, what is the variable repair cost per machine hour? a) $0.15 b) $1.00 c) $4.00 d) $5.00 Answer: b Difficulty: Easy Learning Objective: Describe cost estimation techniques CPA: Management Accounting/Problem-Solving and Decision-Making Bloomcode: Application 61. Smith Company is attempting to develop the cost function for...
CVP Analysis Test Acctg 48 V2 Mona Company incurs $80,000 of annual fixed costs in manufacturing and selling a product that it sells for $16 per unit The variable costs of manufacturing and selling the product are $9 per unit a) The contribution margin per unit for the product is b) The breakeven point in units is c) The breakeven point in dollars is If Mona Company has a 30% income tax rate, and its management wants to earn an...