Homework Answers
| (a) | Sales | 15 | |||
| Less: Variable Cost | 12 | ||||
| Contribution margin | 3 | ||||
| Contribution margin ratio = | Contribution margin/sales | ||||
| = | 3/15 | ||||
| = | 20.00% | ||||
| (b) | Target Income = | (Total Fixed Costs + Target Income) / Contribution Margin Ratio | |||
| = | (600,000 + 120,000)/0.20 | ||||
| = | 3,600,000 | ||||
| (c) | Break-Even Point in Sales = | Total Fixed Costs / Contribution Margin Ratio | |||
| = | 600,000/0.20 | ||||
| = | 3,000,000 | ||||
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Question 1: Company X sells product B. Unit sales revenue of product B is 15 TL....
Homework 3 Question 1: Company X sells product B. Unit sales revenue of product B is...
Homework 3 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 1: Company X sells product B Unit sales revenue of product B is 15 TL...
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:...
2. Operating loss is 18.000 TL when sales revenue is 420.000 TL and operating income is...
2. Operating loss is 18.000 TL when sales revenue is 420.000 TL and operating income is 108.000 TL when sales revenue is 840.000 TL. Required: By using information above, calculate: 25 points a) Total fixed costs b) BEP in TL. c) Contribution margin ratio. d) Unit contribution margin if selling price is 300 TL per unit. e) Operating profit when company sells 3,000 units (selling price is 300 TL per unit), f) Sales revenue to earn 144.000 TL operating profit.
Question 3: Company XY sells two types of hats, A and B. Sales mix sells two...
Question 3: Company XY sells two types of hats, A and B. Sales mix sells two types of hats, A and B. Sales mix of Company XY includes 20.000 hat A's and 50.000 hat B's. Unit sales price is 50 TL, and unit variable cost is 30 TL for hat A. Unit sales price is 35 TL, and unit variable cost is 20 TL for hat B. Total fixed cost of Company XY is 805.000 TL Required: a) How many...
Instructions Multiple-Product Break-even, Break-Even Sales Revenue Cherry Blossom Products Inc. produces and sells yoga-training products: how-to...
Instructions Multiple-Product Break-even, Break-Even Sales Revenue Cherry Blossom Products Inc. produces and sells yoga-training products: how-to DVDS and a basic equipment set (blocks, strap, and small pillows). Last year, Cherry Blossom Products sold 13,500 DVDS and 4,500 equipment sets. Information on the two products is as follows: Equipment Sets DVDS Price $8 $25 Variable cost per unit 15 Total fixed cost is $98,550. Suppose that in the coming year, the company plans to produce an extra-thick yoga mat for sale...
Zachary Company makes a product that sells for $30 per unit. The company pays $11 per...
Zachary Company makes a product that sells for $30 per unit. The company pays $11 per unit for the variable costs of the product and Incurs annual fixed costs of $165,300. Zachary expects to sell 22,100 units of product Required Determine Zachary's margin of safety expressed as a percentage. (Round your answer to 2 decimal places. (.e, 0.2345 should be entered as 23.45) Margin of safety % Reld Company is considering the production of a new product. The expected variable...
Basic Break-Even Calculations Suppose that Adams Company sells a product for $22.00. Unit costs are as...
Basic Break-Even Calculations Suppose that Adams Company sells a product for $22.00. Unit costs are as follows: Direct materials $3.80 Direct labour 1.40 Variable factory overhead 2.30 Variable selling and administrative expense 1.40 Total fixed factory overhead is $74,840 per year, and total fixed selling and administrative expense is $54,195. Required: 1. Calculate the variable cost per unit and the contribution margin per unit. Round your answers to the nearest cent and use rounded amounts in subsequent requirements. Variable cost...
Ritchie Manufacturing Company makes a product that it sells for $200 per unit. The company incurs...
Ritchie Manufacturing Company makes a product that it sells for $200 per unit. The company incurs variable manufacturing costs of $110 per unit. Variable selling expenses are $20 per unit, annual fixed manufacturing costs are $466,000, and fixed selling and administrative costs are $269,000 per year. Required Determine the break-even point in units and dollars using each of the following approaches: a. Use the equation method. b. Use the contribution margin per unit approach. c. Prepare a contribution margin income...
Ritchie Manufacturing Company makes a product that it sells for $190 per unit. The company incurs...
Ritchie Manufacturing Company makes a product that it sells for
$190 per unit. The company incurs variable manufacturing costs of
$96 per unit. Variable selling expenses are $18 per unit, annual
fixed manufacturing costs are $462,000, and fixed selling and
administrative costs are $260,000 per year.
Required
Determine the break-even point in units and dollars using each
of the following approaches:
Use the equation method.
Use the contribution margin per unit approach.
Prepare a contribution margin income statement for the...
Ritchie Manufacturing Company makes a product that it sells for $150 per unit. The company incurs...
Ritchie Manufacturing Company makes a product that it sells for $150 per unit. The company incurs variable manufacturing costs of $76 per unit. Variable selling expenses are $14 per unit, annual fixed manufacturing costs are $352,000, and fixed selling and administrative costs are $266,000 per year. Required Determine the break-even point in units and dollars using each of the following approaches: a. Use the equation method. b. Use the contribution margin per unit approach. c. Use the contribution margin ratio...
Homework 3 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 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:...
2. Operating loss is 18.000 TL when sales revenue is 420.000 TL and operating income is 108.000 TL when sales revenue is 840.000 TL. Required: By using information above, calculate: 25 points a) Total fixed costs b) BEP in TL. c) Contribution margin ratio. d) Unit contribution margin if selling price is 300 TL per unit. e) Operating profit when company sells 3,000 units (selling price is 300 TL per unit), f) Sales revenue to earn 144.000 TL operating profit.
Question 3: Company XY sells two types of hats, A and B. Sales mix sells two types of hats, A and B. Sales mix of Company XY includes 20.000 hat A's and 50.000 hat B's. Unit sales price is 50 TL, and unit variable cost is 30 TL for hat A. Unit sales price is 35 TL, and unit variable cost is 20 TL for hat B. Total fixed cost of Company XY is 805.000 TL Required: a) How many...
Instructions Multiple-Product Break-even, Break-Even Sales Revenue Cherry Blossom Products Inc. produces and sells yoga-training products: how-to DVDS and a basic equipment set (blocks, strap, and small pillows). Last year, Cherry Blossom Products sold 13,500 DVDS and 4,500 equipment sets. Information on the two products is as follows: Equipment Sets DVDS Price $8 $25 Variable cost per unit 15 Total fixed cost is $98,550. Suppose that in the coming year, the company plans to produce an extra-thick yoga mat for sale...
Zachary Company makes a product that sells for $30 per unit. The company pays $11 per unit for the variable costs of the product and Incurs annual fixed costs of $165,300. Zachary expects to sell 22,100 units of product Required Determine Zachary's margin of safety expressed as a percentage. (Round your answer to 2 decimal places. (.e, 0.2345 should be entered as 23.45) Margin of safety % Reld Company is considering the production of a new product. The expected variable...
Basic Break-Even Calculations Suppose that Adams Company sells a product for $22.00. Unit costs are as follows: Direct materials $3.80 Direct labour 1.40 Variable factory overhead 2.30 Variable selling and administrative expense 1.40 Total fixed factory overhead is $74,840 per year, and total fixed selling and administrative expense is $54,195. Required: 1. Calculate the variable cost per unit and the contribution margin per unit. Round your answers to the nearest cent and use rounded amounts in subsequent requirements. Variable cost...
Ritchie Manufacturing Company makes a product that it sells for $200 per unit. The company incurs variable manufacturing costs of $110 per unit. Variable selling expenses are $20 per unit, annual fixed manufacturing costs are $466,000, and fixed selling and administrative costs are $269,000 per year. Required Determine the break-even point in units and dollars using each of the following approaches: a. Use the equation method. b. Use the contribution margin per unit approach. c. Prepare a contribution margin income...
Ritchie Manufacturing Company makes a product that it sells for
$190 per unit. The company incurs variable manufacturing costs of
$96 per unit. Variable selling expenses are $18 per unit, annual
fixed manufacturing costs are $462,000, and fixed selling and
administrative costs are $260,000 per year.
Required
Determine the break-even point in units and dollars using each
of the following approaches:
Use the equation method.
Use the contribution margin per unit approach.
Prepare a contribution margin income statement for the...
Ritchie Manufacturing Company makes a product that it sells for $150 per unit. The company incurs variable manufacturing costs of $76 per unit. Variable selling expenses are $14 per unit, annual fixed manufacturing costs are $352,000, and fixed selling and administrative costs are $266,000 per year. Required Determine the break-even point in units and dollars using each of the following approaches: a. Use the equation method. b. Use the contribution margin per unit approach. c. Use the contribution margin ratio...
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