Question
1. If fixed costs are $830,000 and variable costs are 69% of sales, the break-even point in sales dollars is a.$2,677,419 b.$3,507,419 c.$572,700 d.$1,402,700 3.
1. If fixed costs are $830,000 and variable costs are 69% of sales, the break-even point in sales dollars is
a.$2,677,419
b.$3,507,419
c.$572,700
d.$1,402,700
3. If fixed costs are $1,356,000, the unit selling price is $235, and the unit variable costs are $103, the amount of sales (units) required to realize an operating income of $251,000 is
a.13,165 units
b.5,770 units
c.12,174 units
d.2,437 units
4. If fixed costs are $561,000 and the unit contribution margin is $8.00, the break-even point in units if variable costs are decreased by $0.50 per unit is
a.74,800 units
b.60,000 units
c.66,000 units
d.70,125 units
6. Flying Cloud Co. has the following operating data for its manufacturing operations:
Unit selling price | $241 |
Unit variable cost | $110 |
Total fixed costs | $802,000 |
The company has decided to increase the wages of hourly workers which will increase the unit variable cost by 10%. Increases in the salaries of factory supervisors and property taxes for the factory will increase fixed costs by 4%. If sales prices are held constant, the next break-even point for Flying Cloud Co. will be
a.increased by 829 units
b.decreased by 829 units
c.increased by 663 units
d.increased by 994 units
7. If fixed costs are $500,000 and the unit contribution margin is $20, the break-even point in units if fixed costs are reduced by $80,000 is
a.25,000 units
b.4,000 units
c.21,000 units
d.29,000 units
8. Rusty Co. sells two products: X and Y. Last year, Rusty sold 5,000 units of X and 35,000 units of Y. Related data are as follows:
Product | Unit Selling Price | Unit Variable Cost | Unit Contribution Margin |
X | $110 | $70 | $40 |
Y | 70 | 50 | 20 |
Assuming that last year's fixed costs totaled $675,000, Rusty Co.'s break-even point in units was
a.30,000 units
b.30,100 units
c.11,250 units
d.16,875 units
9. Carter Co. sells two products: Arks and Bins. Last year, Carter sold 14,000 units of Arks and 56,000 units of Bins. Related data are as follows:
Product | Unit Selling Price | Unit Variable Cost | Unit Contribution Margin |
Arks | $120 | $80 | $40 |
Bins | 80 | 60 | 20 |
Assuming that last year's fixed costs totaled $960,000, Carter Co.'s break-even point in units was
a.28,000 units
b.40,000 units
c.35,000 units
d.12,000 units
10. Given the following cost and activity observations for Smithson Company's utilities, use the high-low method to determine Smithson's fixed costs per month. Round your final answer to the nearest dollar. Do not round interim calculations.
Cost | Machine Hours | |
January | $26,400 | 10,500 |
February | 36,300 | 18,500 |
March | 28,000 | 12,500 |
April | 31,400 | 14,900 |
a.$13,406
b.$10,725
c.$42,899
d.$22,790
11. Rusty Co. sells two products: X and Y. Last year, Rusty sold 5,000 units of X and 35,000 units of Y. Related data are as follows:
Product | Unit Selling Price | Unit Variable Cost | Unit Contribution Margin |
X | $110 | $70 | $40 |
Y | 70 | 50 | 20 |
For break-even analysis, the unit variable cost of E was
a.$70.00
b.$120.00
c.$52.50
d.$50.00
13. Carter Co. sells two products: Arks and Bins. Last year, Carter sold 14,000 units of Arks and 56,000 units of Bins. Related data are as follows:
Product | Unit Selling Price | Unit Variable Cost | Unit Contribution Margin |
Arks | $120 | $80 | $40 |
Bins | 80 | 60 | 20 |
Carter Co.'s unit contribution margin of E was
a.$60
b.$24
c.$92
d.$20
14. If a business had sales of $3,715,000 and a margin of safety of 20%, the break-even point was
a.$2,972,000
b.$4,458,000
c.$6,687,000
d.$743,000
15. Rusty Co. sells two products: X and Y. Last year, Rusty sold 5,000 units of X and 35,000 units of Y. Related data are as follows:
Product | Unit Selling Price | Unit Variable Cost | Unit Contribution Margin |
X | $110 | $70 | $40 |
Y | 70 | 50 | 20 |
For break-even analysis, the unit contribution margin of E was
a.$22.50
b.$20.00
c.$40.00
d.$60.00
16. If fixed costs are $850,000 and variable costs are 60% of sales, the break-even point (dollars) is
a.$1,416,666
b.$3,400,000
c.$2,125,000
d.$340,000
17. If fixed costs are $600,000 and the unit contribution margin is $40, the break-even point if fixed costs are increased by $90,000 is
a.15,000 units
b.8,333 units
c.17,250 units
d.9,667 units
19. Beemer's sales are $400,000, variable costs are 75% of sales, and operating income is $50,000. The operating leverage is
a.2.0
b.2.5
c.7.5
d.0
20. Question Content Area
Given the following cost and activity observations for George Company's utilities, use the high-low method to determine George's variable utilities cost per machine hour.
Cost | Machine Hours | |
May | $16,500 | 105,000 |
June | 18,000 | 120,000 |
July | 16,000 | 100,000 |
August | 17,500 | 117,000 |
a.$100.00
b.$10.00
c.$1.00
d.$0.10
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