1. Beau Corporation sells a unit of its product for $250 per unit, while its variable costs per unit are $75. Fixed cost are budgeted at $325,000.

How many units must Beau Corporation sell in order to earn a target income of $200,000.

A. 3,000 units

B. 2,500 units

C. 1,143 units

D. 1,858 units

Using the information above, what is the contribution margin ratio?

A. .70

B. .30

C. .75

D. .55

2. Tess Industries manufactures product Q in its factory. The standard direct material quantity is 2 pounds per unit at a cost of $5.20 per pound. 4,200 pounds of material were purchased at a total cost of $20,580. The actual usage for the production of 2,000 units was 3,900 pounds.

Calculate the direct materials price variance.

A. $600 favorable

B. $1,260 favorable

C. $600 unfavorable

D. $1,260 unfavorable

Calculate the direct material quantity variance.

A. $490 favorable

B. $520 unfavorable

C. $490 unfavorable

D. $520 favorable