1.Electric Jet Skis operates a jet ski rental business. Assume the jet skis rent for $55 for 6 hours. The variable costs are $33 per 6 hour rental, and its fixed costs are $80,000 each month. What is the contribution margin per 6 hour jet ski rental?

a. $33.00

b. $0.40

c. $22.00

d. $2.50

2. LaComedia Dinner Theater sells tickets for dinner and a show for $40 each. The cost of providing dinner is $26 per ticket and the fixed cost of operating the theater is $100,000 per month. The company can accommodate 12,000 patrons each month. What is the contribution margin ratio?

a. 65%

b. 35%

c. 14%

d. 286%

5. A product is sold at $60.00 per unit, the variable expense per unit is $30, and total fixed expenses are $200,000, what are the breakeven sales in dollars?

a. $3,333

b. $100,000

c. $133,333

d. $400,000

15. Neeley Grocery has a monthly target operating income of $25,000. Variable expenses are 20% of sales and monthly fixed expenses are $15,000. What is the monthly margin of safety as a percentage of target sales in dollars?

a. 137.50%

b. 62.50%

c. 80.00%

d. 166.67%

20. SportSupplies Corporation has budgeted purchases of inventory for December of $140,000. Expected beginning inventory on December 1 and ending inventory on December 31 are $90,000 and $120,000, respectively. If cost of goods sold averages 88% of sales, what are budgeted sales for December?

a. $125,000

b. $96,800

c. $193,182

d. $397,727

22. A lamp store purchased $3,800 of lamps in September. The store had $1,600 of lamps on hand at the beginning of September, and expected to have $1,300 of lamps at the end of September to cover part of anticipated October sales. What is the budgeted cost of goods sold for September?

a. $5,400

b. $4,100

c. $6,700

d. $3,500

26. Expected purchases for June and July are $80,000 and $92,000, respectively. Purchases for May were $60,000. All purchases are paid 45% in the month of purchase and 55% the following month. At what amount are June payments for purchases budgeted?

a. $69,000

b. $71,000

c. $86,600

d. $110,400

27. Lakewood Jet Skis has budgeted sales for June and July at $420,000 and $480,000, respectively. Sales are 75% credit, of which 40% is collected in the month of sale and 60% is collected in the following month. What is the accounts receivable balance on July 31?

a. $189,000

b. $288,000

c. $216,000

d. $360,000