In 2021, Demuth Company had a break-even point of $350,000 based on a selling price of $5

Question:

In 2021, Demuth Company had a break-even point of $350,000 based on a selling price of $5 per unit and fixed costs of $112,000. In 2022, the selling price and the variable cost per unit did not change, but the break-even point increased to $420,000.

Instructions

a. Calculate the variable cost per unit and the contribution margin ratio for 2021.

b. Calculate the increase in fixed costs for 2022.

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Managerial Accounting Tools For Business Decision Making

ISBN: 9781119731825

6th Canadian Edition

Authors: Jerry J. Weygandt, Paul D. Kimmel, Ibrahim M. Aly, Donald E. Kieso

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Question Posted: May 09, 2023 06:34 AM

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In 2021, Demuth Company had a break-even point of $350,000 based on a selling price of $5

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Managerial Accounting Tools For Business Decision Making

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