Question
1. Determine the total fixed costs and the total variable costs for 2014. Total variable costs $ Total fixed costs $ 2. Determine for 2014
1. Determine the total fixed costs and the total variable costs for 2014.
Total variable costs | $ |
Total fixed costs | $ |
2. Determine for 2014 (a) the unit variable cost and (b) the unit contribution margin.
Unit variable cost | $ |
Unit contribution margin | $ |
3. Compute the break-even sales (units) for 2014. units
4. Compute the break-even sales (units) under the proposed program. units
5. Determine the amount of sales (units) that would be necessary under the proposed program to realize the $5,650,000 of income from operations that was earned in 2014. units
6. Determine the maximum income from operations possible with the expanded plant. $
7. If the proposal is accepted and sales remain at the 2014 level, what will the income or loss from operations be for 2015? $ SelectIncomeLossItem 10
8. Based on the data given, would you recommend accepting the proposal?
- In favor of the proposal because of the reduction in break-even point.
- In favor of the proposal because of the possibility of increasing income from operations.
- In favor of the proposal because of the increase in break-even point.
- Reject the proposal because if future sales remain at the 2014 level, the income from operations of will increase.
- Reject the proposal because the sales necessary to maintain the current income from operations would be below 2014 sales.
Choose the correct answer.
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