1.Razor Inc. manufactures industrial components. One of its products used as a subcomponent in auto manufacturing is Fluoro2211. The selling price and cost per unit data for 9,000 units of Fluoro2211 are as follows.

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	Per Unit Data
Selling Price		$	150
Direct Materials			20
Direct Labor			15
Variable Manufacturing Overhead			12
Fixed Manufacturing Overhead			30
Variable Selling			3
Fixed Selling and Administrative			10
Total Costs			90
Operating Margin		$	60

During the next year, sales of Fluoro2211 are expected to be 10,000 units. All costs will remain the same except for fixed manufacturing overhead, which will increase by 20%, and material, which will increase by 10%. The selling price per unit for next year will be $160. Based on these data, Razor Inc.'s total contribution margin for next year will be: (CMA adapted)

a.) $882,000.

b.) $980,000.

c.) $972,000.

d.) $1,080,000.

2. Lamar has the following data:

Selling Price	$	40
Variable manufacturing cost	$	22
Fixed manufacturing cost	$	150,000	per month
Variable selling & administrative costs	$	6
Fixed selling & administrative costs	$	120,000	per month

How many units must Lamar produce and sell in order to break-even?

a.) 8,333 units.

b.) 12,500 units.

c.) 15,000 units.

d.) 22,500 units.

3.Lamar has the following data:

Selling Price	$	40
Variable manufacturing cost	$	22
Fixed manufacturing cost	$	150,000	per month
Variable selling & administrative costs	$	6
Fixed selling & administrative costs	$	120,000	per month

How many units must Lamar produce and sell in order to achieve a profit of $30,000 per month?

a.) 10,000 units.

b.) 8,824 units.

c.) 25,000 units.

d.) 15,000 units.

4.Gena Manufacturing Company has a fixed cost of $225,000 for the production of tubes. Estimated sales are 150,000 units. A before tax profit of $125,000 is desired by the controller. If the tubes sell for $5 each, what unit contribution margin is required to attain the profit target?

a.) $3.00.

b.) $2.33.

c.) $1.47.

d.) $.90.

5.Honeysuckle Manufacturing has the following data:

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Selling Price	$	60
Variable manufacturing cost	$	33
Fixed manufacturing cost	$	250,000	per month
Variable selling & administrative costs	$	9
Fixed selling & administrative costs	$	120,000	per month

What dollar sales volume does Honeysuckle need to break even?

a.) $822,222.

b.) $833,333.

c.) $900,000.

d.) $1,233,333.

6.Eastwick produces and sells three products. Last month's results are as follows:

	P1			P2			P3
Revenues	$	100,000		$	200,000		$	200,000
Variable costs		40,000			140,000			80,000

Fixed costs total $200,000. What sales volume would generate an operating profit of $150,000? (Assume the current product mix.)

a.) $650,000.

b.) $610,000.

c.) $729,167.

d.) $850,000.