Rundle Company produces a product that has a variable cost of $26 per unit and a sales price of $58 per unit. The company’s annual fixed costs total $660,000. It had net income of $260,000 in the previous year. In an effort to increase the company’s market share, management is considering lowering the selling price to $51 per unit.
Required
If Rundle desires to maintain net income of $260,000, how many additional units must it sell to justify the price decline?
Assume that in addition to lowering its selling price to $51, Rundle also desires to increase its net income by $80,000. Determine the number of units the company must sell to earn the desired income.
Variable cost per unit
Total variable cost
Total contribution margin
Rundle Company produces a product that has a variable cost of $26 per unit and a...
Malone Company produces a product that has a variable cost of $30 per unit and a sales price of $70 per unit. The company’s annual fixed costs total $820,000. It had net income of $380,000 in the previous year. In an effort to increase the company’s market share, management is considering lowering the selling price to $60 per unit. Required If Malone desires to maintain net income of $380,000, how many additional units must it sell to justify the price...
Rooney Company produces a product that has a variable cost of $21 per unit and a sales price of $61 per unit. The company’s annual fixed costs total $710,000. It had net income of $270,000 in the previous year. In an effort to increase the company’s market share, management is considering lowering the selling price to $53 per unit. Required If Rooney desires to maintain net income of $270,000, how many additional units must it sell to justify the price...
Rundle Company produces a product that sells for $48 per unit and has a variable cost of $27 per unit. Rundle incurs annual fixed costs of $138,600. Required Determine the sales volume in units and dollars required to break even. (Do not round intermediate calculations.) Calculate the break-even point assuming fixed costs increase to $174,300. (Do not round intermediate calculations.)
Rundle Company incurs annual fixed costs of $103,055. Variable costs for Rundle's product are $25.20 per unit, and the sales price is $40.00 per unit. Rundle desires to earn an annual profit of $64,000. Required Use the contribution margin ratio approach to determine the sales volume in dollars and units required to earn the desired profit. (Do not round intermediate calculations. Round your final answers to the nearest whole number.) Sales in dollars Sales volume in units
Jensen Company has the following situation: Sales Price: $50 per unit Variable Cost Per Unit: $30 per unit Fixed Costs: $20,000 Units Sold: 4.000 Jensen is considering lowering the price to $45 per unit which she believes would increase units sold to 5,000 Required • Calculate the net income under the current situation and then again with the changes. • Using the original data, what selling price would be needed to have a net income of $20,000? Should Jensen lower...
Rundle Manufacturing Company set its standard variable manufacturing cost at $25 per unit of product. The company planned to make and sell 3,800 units of product during Year 3. More specifically, the master budget called for total variable manufacturing cost to be $95,000. Actual production during Year 3 was 4,000 units, and actual variable manufacturing costs amounted to $100,900. The production supervisor was asked to explain the variance between budgeted and actual cost ($100,900 – $95,000 = $5,900). The supervisor...
Fowler Company produces a product that sells for $200 per unit and has a variable cost of $125 per unit. Fowler incurs annual fixed costs of $450,000 Required a. Determine the sales volume in units and dollars required to break even. (Do not round intermediate calculations.) b. Calculate the break-even point assuming fixed costs increase to $600,000. (Do not round intermediate calculations.) Answer is not complete. 6,000 $ 1,200,000 Sales volume in units Sales in dollars Break-even units Break-even sales...
Helium Company has the following information available: Selling price per unit $5.00 Variable cost per unit $3.50 Total fixed costs $90,000.00 Targeted net income $30,000.00 How many units must be sold to achieve the targeted net income? 80,000 units 27,000 units 45,000 units 10,000 units *Please show work
Cobe Company has already manufactured 16,000 units of Product A at a cost of $25 per unit. The 16,000 units can be sold at this stage for $450,000. Alternatively, the units can be further processed at a $260,000 total additional cost and be converted into 6,000 units of Product B and 11,500 units of Product C. Per unit selling price for Product B is $101 and for Product C is $51. 1. Prepare an analysis that shows whether the 16,000...
Askew Enterprises produces a product with fixed costs of $200,000 and variable cost of $9 per unit. The company desires to earn a $100,000 profit and believes it can sell 20,000 units of the product. Required Based on this information, determine the target sales price. Assume a competitor is currently selling a similar product for $20 per unit. Explain how Askew can use target costing to maintain its desired profitability