Question 2: Company A is considering two options with the following data: Option 1: Alternative II...
Question 2: Company A is considering two options with the following data: Option I: Unit Sales Revenue: $18 Unit Sales Revenue: $18 Unit Variable Cost : $16 Total Fix Cost: $2.000.000 Total Fix Cost: $ 6.000.000 |Alternative II Unit Variable Cost : $14 Required: a) At what sales volume Company A is indifferent between two alternatives? Explain which alternative is better b What is the Break Even Point (BEP) for Option I?
Question 1: Company X sells product B Unit sales revenue of product B is 15 TL Unit variable cost for product B is 12 TL Total fixed cost of Company X is 600.000 TL Required: a) Calculate contribution margin ratio for product B. b) Calculate the revenue to be earned in order to yield an operating income of 120.000 TL Use contribution margin method. c) What is total revenue at Break Even Point? Use any method you like. Question 2:...
Question 4: Company A has two alternatives as below: Alternative Unit Sales Revenue: $13 Direct Labor Cost : $5 Direct Material Cost : $3 Total Fix Cost : $1.500.000 Alternative 11 Unit Sales Revenue: $13 Direct Labor Cost : $3 Direct Material Cost : $3 Total Fix Cost: $2.100.000 Required: a) According to Alternative I, how much revenue is needed to be earned to reach to Break Even Point? (unit contribution margin ratio) b) According to Alternative II, how much...
QUESTION 5 (20 points) A firm is considering two capacity alternatives: Alternative A and Alternative B. Alternative A would have an annual fixed cost of $40,000 and variable costs of $400 per unit. Alternative B would have annual fixed costs of $60,000 and variable costs of $200 per unit. Revenue per unit is expected to be $1000 per unit for Alternative A and $1050 for Alternative B. Complete the following parts using Excel. a) Create a graph for each alternative...
Patterson Products Inc. is considering an upgrade to its manufacturing equipment. The two upgrade options under consideration are shown below. Option 1 Option 2 Direct material cost per unit $ 93.6 $ 62.4 Direct labour cost per unit $ 66 $ 59 Variable overhead per unit $ 27.6 $ 55.4 Fixed manufacturing costs $ 2,160,000 $ 5,592,000 The selling price of the company’s product is $312 per unit with variable selling costs of 10% of sales. Fixed selling and administrative...
Break even point for alternative 1 is? Break even point for alternative two is? Problem 18-4A a-b (Part Level Submission) (Video) Carla Vista Corp.'s sales slumped badly in 2020. For the first time in its history, it operated at a loss. The company's income statement showed the following results from selling 585,500 units of product: sales $2,927,500, total costs and expenses $3,036,000, and net loss $108,500. Costs and expenses consisted of the amounts shown below. Cost of goods sold Selling...
CALCULATOR FULL SCREEN Brief Exercise 18-04 Cullumber Company accumulates the following data concerning a mixed cost, using miles as the activity level. January February Miles Driven 8,005 7,500 Total Cost $14,170 13,490 March April Miles Driven 8,500 8,200 Total Cost $14,790 14,485 Compute the variable cost per mile using the high-low method (Round answer to 2 decimal places, e.g. 2.25.) Variable cost per mile Compute the fixed cost elements using the high-low method. Fixed costs Problem 18-04A Pharoah Corp.'s sales...
Cheesy Company The Company is considering the introduction of a new product with the following price and cost characteristics Sales price $150 each Variable cost $60 each Fixed cost $135,000 per year The company expects to sell 2,000 units for the year. 16. Refer Cheesy Company. How many units must be sold to break even? a. 900 b. 2,250 c. 2,000 d. 1,500 17. What effect could an increase (investment) in fixed costs have on the break-even point and the contribution...
Las how on both the sugar cane and potato farming options and advice management which option will be best to venture into (20) QUESTION 2 (16 marks) Bags-R-Us is a bag manufacturing company quarter of Bags-R-Us The following is the information relating to the fourth Sales (1200 units) Direct material Direct labour Total fixed cost R360 000 R120 per unit R110 per unit R70 000 Required: 1 Calculate the total contribution cost and the variable cost ratio 2 Calculate the...
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...