Homework Answers
Answer:
a) Determine sales volume, fixed cost & variable cost per unit at break even point
Break even point = No profit, No loss = Profit =$0
From the table we can see that
Break even point = where profit is $0
| a | Sales Volume | 2000 |
| b | Fixed Cost | 30000 |
| c | Variable Cost | $13 |
we can verify,
| Sales[2000 x $28] | 56000 |
| less: | |
| Variable cost [$13 x 2000] | (26000) |
| Fixed cost | (30000) |
| Net Profit | $0 |
b) Expected Profit
| Sales [4000 bottles x $28] | $112000 |
| Less: | |
| Variable cost [4000 x $13] | (52000) |
| Fixed cost | (20000) |
| Net profit (expected) | $40,000 |
c) effect on profitability if opportunity is accepted.
| Sale [4000 bottles x $28] | $112000 |
| Less: | |
| Variable cost [4000 x $11] | (44000) |
| Fixed cost | (30000) |
| Net income | $38000 |
If this opportunity is accepted it decreases the profit by $2000
Add Answer to:
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Q.6 Use the below table to answer the following questions. Selling Price = $27.00 Sales Volume...
Q.6
Use the below table to answer the following questions.
Selling Price = $27.00
Sales Volume
Fixed Cost
Variable Cost
2,100
3,100
4,100
5,100
6,100
Profitability
$
25,700
8
$
14,200
$
33,200
$
52,200
$
71,200
$
90,200
25,700
9
12,100
30,100
48,100
66,100
84,100
25,700
10
10,000
27,000
44,000
61,000
78,000
35,700
8
4,200
23,200
42,200
61,200
80,200
35,700
9
2,100
20,100
38,100
56,100
74,100
35,700
10
–
17,000
34,000
51,000
68,000
45,700
8
(5,800
)
13,200
32,200...
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Q.6
Use the below table to answer the following questions.
Selling Price = $27.00
Sales Volume
Fixed Cost
Variable Cost
2,100
3,100
4,100
5,100
6,100
Profitability
$
25,700
8
$
14,200
$
33,200
$
52,200
$
71,200
$
90,200
25,700
9
12,100
30,100
48,100
66,100
84,100
25,700
10
10,000
27,000
44,000
61,000
78,000
35,700
8
4,200
23,200
42,200
61,200
80,200
35,700
9
2,100
20,100
38,100
56,100
74,100
35,700
10
–
17,000
34,000
51,000
68,000
45,700
8
(5,800
)
13,200
32,200...
JUUUTOCLULV Uveredu Variable 30,000 Fixed 50,000 Selling and administrative expenses: Variable 20,000 Fixed 30,000 Compute the average markup percentage for setting prices as a percentage of: a. The full cost of the product b. The variable cost of the product c. Variable manufacturing costs d. Total manufacturing costs #9 (7 marks) For the current year, Babcock Ltd., forecast sales of 42,000 units and production of 40,000 units. Other budget information for the year included: Direct manufacturing labour $171,900 Variable manufacturing...
Credits Debits 30,000 40,000 1,500 60,000 20,000 0 2,000 6,000 80,000 Account Title Cash Accounts receivable Supplies Inventory Notes receivable Interest receivable Prepaid rent Prepaid insurance Office equipment Accumulated depreciation Accounts payable Salaries payable Notes payable Interest payable Deferred sales revenue Common stock Retained earnings Dividends Sales revenue Interest revenue Cost of goods sold Salaries expense Rent expense Depreciation expense Interest expense Supplies expense Insurance expense Advertising expense Totals 30,000 31,000 0 50,000 0 2,000 60,000 28,500 4,000 146,000 0...
Credits Debits 30,000 40,000 1,500 60,000 20,000 0 2,000 6,000 80,000 Account Title Cash Accounts receivable Supplies Inventory Notes receivable Interest receivable Prepaid rent Prepaid insurance Office equipment Accumulated depreciation Accounts payable Salaries payable Notes payable Interest payable Deferred sales revenue Common stock Retained earnings Dividends Sales revenue Interest revenue Cost of goods sold Salaries expense Rent expense Depreciation expense Interest expense Supplies expense Insurance expense 30,000 31,000 0 50,000 0 2,000 60,000 28,500 4,000 146,000 0 70,000 18,900 11,000...
Varela Corporation's relevant range of activity is 2,000 units to 6,000 units. When it produces and sells 4,000 units, its average costs per unit are as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Fixed selling expense Fixed administrative expense Sales commissions Variable administrative expense Average Cost per Unit $5.95 $3.30 $1.60 $3.00 $0.50 $0.40 $1.50 $0.50 For financial reporting purposes, the total amount of product costs incurred to make 4,000 units is closest to: Multiple Choice...
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