CVP analysis is used to estimate how profits are affected by all of the following factors...
CVP analysis is used to estimate how profits are
affected by all of the following factors except :
a. sales volume
b. mix of products sold
c. opportunity costs
d. selling prices
e. unit variable costs
Homework Answers
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CVP analysis is used to estimate how profits are
affected by all of the following factors...
The cost volume profit analysis, commonly referred to as CVP, is a planning process that management...
The cost volume profit analysis, commonly referred to as CVP, is a planning process that management uses to predict the future volume of activity, costs incurred, sales made, and profits received. In other words, it’s a mathematical equation that computes how changes in costs and sales will affect income in future periods (Peavler, 2019). CVP analysis provides managers with the advantage of being able to answer specific questions needed in business analysis. Such as, what is the company's breakeven point?...
which of the following is not an assumption of cost-volume-profit (CVP) analysis? a) The number of...
which of the following is not an assumption of cost-volume-profit (CVP) analysis? a) The number of units sold is the only revenue driver and the only cost driver. b) Total costs can be separated into two components. c) When represented graphically, the behaviors of total revenues and total cost are linear. d) Selling price, variable cost per unit, and total fixed costs are known and constant. e) The total costs are never separate into components in this analysis.
Which one of the following is not an assumption of CVP analysis?
Which one of the following is not an assumption of CVP analysis? Profit for the period is constant. The sales mix is constant. Costs can be classified as variable or fixed. Volume or level of activity affects costs.
CVP analysis Gary's Florist CVP Income Statement For the Year Ending December 31, 2017...
CVP analysis
Gary's Florist
CVP Income Statement
For the Year Ending December 31, 2017
Total
Per Unit
Sales
Revenue
Variable
Costs
Contribution Margin
Fixed
Costs
Net
Income
Units
Sold:
Sales Revenue Per Unitt som Variable costs per unit $31 . Fixed Costs $151,875 * Create formulas in the appropriate locations for all remaining elements except Units Soid, which should remain blank. Use Goal Seek to determine the breakeven unit sales. Create a second CVP Analysis tab (named appropriately) and use...
Which of the following is an assumption underlying standard CVP analysis? Multiple Choice The price of...
Which of the following is an assumption underlying standard CVP analysis? Multiple Choice The price of a product or service is expected to change as volume changes. 0 Fixed expenses will change as volume increases. In multiproduct companies, the sales mix is constant. С C In manufacturing companies, inventories always change. If sales volume increases and all other factors remain constant, then the: Multiple Choice net operating income will decrease. O margin of safety will increase. contribution margin ratio will...
Please show work. Thanks. Practice Problem 1 CVP Analysis The Scholten Manufacturing Company produces the following...
Please show work. Thanks.
Practice Problem 1 CVP Analysis The Scholten Manufacturing Company produces the following three products: Selling price per unit Variable costs per unit Contribution per unit Hammers Screwdrivers $20 14 Saws $25 15 $2 $10 Fixed costs are $112,000 per year. 50% of all sales in units are hammers, 30% are screwdrivers, and 20% are saws. Calculate the following values: a. Breakeven point in total units. b. Number of hammers that will be sold at breakeven. c....
Newcastle Division Topic: CVP. Probabilities and Target profits A meeting of senior managers at the Newcastle...
Newcastle Division Topic: CVP. Probabilities and Target profits A meeting of senior managers at the Newcastle Division has been called to discuss the pricing strategy for a new product. Part of the discussion will focus on the problem of s volume. In the last year a significant number of new products have failed to achieve their forecast sales volumes. The financial accountant has already stated that the profit for the year-end will be lower than budget and the main reason...
CVP analysis—what-if questions; sales mix issue Ozark Metal Co. makes a single product that sells for...
CVP analysis—what-if questions; sales mix issue Ozark Metal Co. makes a single product that sells for $42 per unit. Variable costs are $27.30 per unit, and fixed costs total $65,415 per month. Required: a. Calculate the number of units that must be sold each month for the firm to break even. b. Assume current sales are $220,000. Calculate the margin of safety and the margin of safety ratio. c. Calculate operating income if 5,000 units are sold in a month....
Cost-volume-profit (CVP) analysis is a powerful tool for planning and decision making. Thus, CVP analysis emphasized...
Cost-volume-profit (CVP) analysis is a powerful tool for planning and decision making. Thus, CVP analysis emphasized the interrelationships of costs, quantity sold, and price. This analysis is defined as assessment of total revenues, total costs and operating income in response to changes in the volume of sales, the selling price, variable cost or fixed costs of production. The CVP analysis can be a valuable tool in identifying the extent and magnitude of the economic trouble a company is facing and...
95. Ferguson Co. incurs $568,000 in fixed costs while producing three products with the following characteristics:...
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...
CVP analysis
Gary's Florist
CVP Income Statement
For the Year Ending December 31, 2017
Total
Per Unit
Sales
Revenue
Variable
Costs
Contribution Margin
Fixed
Costs
Net
Income
Units
Sold:
Sales Revenue Per Unitt som Variable costs per unit $31 . Fixed Costs $151,875 * Create formulas in the appropriate locations for all remaining elements except Units Soid, which should remain blank. Use Goal Seek to determine the breakeven unit sales. Create a second CVP Analysis tab (named appropriately) and use...
Which of the following is an assumption underlying standard CVP analysis? Multiple Choice The price of a product or service is expected to change as volume changes. 0 Fixed expenses will change as volume increases. In multiproduct companies, the sales mix is constant. С C In manufacturing companies, inventories always change. If sales volume increases and all other factors remain constant, then the: Multiple Choice net operating income will decrease. O margin of safety will increase. contribution margin ratio will...
Please show work. Thanks.
Practice Problem 1 CVP Analysis The Scholten Manufacturing Company produces the following three products: Selling price per unit Variable costs per unit Contribution per unit Hammers Screwdrivers $20 14 Saws $25 15 $2 $10 Fixed costs are $112,000 per year. 50% of all sales in units are hammers, 30% are screwdrivers, and 20% are saws. Calculate the following values: a. Breakeven point in total units. b. Number of hammers that will be sold at breakeven. c....
Newcastle Division Topic: CVP. Probabilities and Target profits A meeting of senior managers at the Newcastle Division has been called to discuss the pricing strategy for a new product. Part of the discussion will focus on the problem of s volume. In the last year a significant number of new products have failed to achieve their forecast sales volumes. The financial accountant has already stated that the profit for the year-end will be lower than budget and the main reason...
CVP analysis—what-if questions; sales mix issue Ozark Metal Co. makes a single product that sells for $42 per unit. Variable costs are $27.30 per unit, and fixed costs total $65,415 per month. Required: a. Calculate the number of units that must be sold each month for the firm to break even. b. Assume current sales are $220,000. Calculate the margin of safety and the margin of safety ratio. c. Calculate operating income if 5,000 units are sold in a month....
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...
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