1)

Mason Company manufactures and sells shoelaces for $2.00 per pair. Its variable cost per unit is $1.70. Mason's total fixed costs are $10,500. How many pairs must Mason Company sell to break even?

5,250.

6,176.

35,000.

52,500.

61,760.

2)

Flannigan Company manufactures and sells a single product that sells for $450 per unit; variable costs are $300. Annual fixed costs are $870,000. Current sales volume is $4,200,000. Compute the contribution margin per unit.

$450.

$300.

$200.

$190.

$150.

4)

The Goldfarb Company manufactures and sells toasters. Each toaster sells for $23.75 and the variable cost per unit is $16.25. Goldfarb's total fixed costs are $25,000, and budgeted sales are 8,000 units. What is the contribution margin per unit?

$7.50.

$16.25.

$23.75.

$60,000.

$1.25.

5)

Which of the following costs are most likely to be classified as variable?

Factory rent

Manager salaries

Insurance

Direct materials

Straight-line depreciation

6)

Maroon Company's contribution margin ratio is 24%. Total fixed costs are $84,000. What is Maroon's break-even point in sales dollars?

$20,160.

$110,526.

$350,000.

$240,000.

$84,000.

7)

A company has fixed costs of $320,000 and a contribution margin per unit of $15. If the firm wants to earn a target $40,000 pretax income, how many units must be sold (rounded to the nearest whole unit)?

24,000.

21,333.

18,666.

2,667.

20,000.

8)

The following information is available for a company's cost of sales over the last five months.

Month	Units sold	Cost of sales
January	400	$31,000
February	800	$37,000
March	1,600	$49,000
April	2,400	$61,000

Using the high-low method, the estimated total fixed cost is:

$25,000

$30,000

$13,692

$100,000

$50,000

9)

Raven Company has a target of earning $70,000 pre-tax income. The contribution margin ratio is 30%. What amount of dollar sales must be achieved to reach the goal if fixed costs are $36,000?

$23,333.

$36,000.

$300,000.

$353,333.

$420,000.

10)

The following information is available for a company's utility cost for operating its machines over the last four months.

Month	Machine hours	Utility cost
January	900	$5,450
February	1,800	$6,900
March	2,400	$8,100
April	600	$3,600

Using the high-low method, the estimated variable cost per unit for utilities is:

$3.38

$6.00

$2.50

$4.22

$6.17