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QUESTION 24 Alpha Companys fixed costs for the year amounted to s350,000 and its unit contribution margin was $30 per unit. Beta Companys fixed costs for the year also amounted to $450,000 but its unit contribution margin was $30 per unit. Which company had the lower break-even point? 1.Alpha Company had the lower break-even point. 2. Beta Company had the lower break-even point. QUESTION 25 Jen & Berrys currently sells 100,000 pints of ice cream per month according to the following income statement: Total S 300,000 200,000 Per Unit S S 3.00 2.00 1.00 SALES VARIABLE COSTS CONTRIBUTION MARGIN 100,000 FIXED COSTS NET INCOME How many pints must be sold in a month to earn a Net Income of $100,000? 50,000 S 50,000 75,000 pints 150,000 pints 200,000 pints none of the above are the correct number of pints that must be sold to earn $100,000 of Net Income. QUESTION 26 The usual starting point for a master budget is O 1.the direct materials purchase budget O 2. the sales forecast or sales budget O 3.the budgeted income statement. O 4.the production budget.

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All 3 are the individual questions, although all have been answered :) Solution: Answer: 24) Explanation: 1. Alpha company had lower break even point Break even point in units Fixed cost/ Contribution margin per unit Alpha Beta 11667 (350000/30) (450000/30) 15000 Answer: 25) Explanation: 150000 units (50000+100000) Total Need Contribution margin per unit Target unit sale units 150000 (150000/1) 150000 units Answer: 26) Explanation: 2. the sales forcast or sales budget. Because, each element of cost and revenue depends upon Sales. Therefore, master bubget starts with sales budget.

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