Accounting 48 1. A product sells for $30 per unit and has variable costs of $18 per unit The fixed costs are $720,000. If the variable costs per unit were to decrease to $15 per unit and fixed costs increase to $900,000, and the selling price does not change, break-even point in units would Increase by 20,000 B) Equal 6,000 C) Increase by 6,000 D) Decrease by 20,000 E) Not change 2. Conan Company has total fixed costs of $112,000. Its product sells for $35 per unit and variable costs amount to $25 per unit. Next year Conan Company wishes to earn a pretax income that equals 10% of fixed costs How many units must be sold to achieve this target income level? A) B) 1,120 8.214 11,200 12,320 14.080 D) 3 Assume that two points from the estimated line of cost behavior from a scatter diagram are as follows: Point A Point B Unit Sales 14,000 42,000 Costs $18,200 $28,000 Rounded to the nearest whole cent, the variable cost per sales unit is B) C) D) E) $0.23 $0.35 $1.50 $2.86 None of the above 4. Baker Company's sales mix is 3 units of A, 2 units of B, and 1 unit of C. Selling prices for each product are $20, $30, and $40, respectively. Variable costs per unit are $12.$18 and $24, respectively. Fixed costs are $320,000. What is the break-even point in units of A, B, and C? A) A15.000: 10.000. C 5,000. B) C) A 18,000 B 12,000, 6,000 D) A 5.000, B 10.000, C 15,000 E) A 4,000, B 8,000; C12.000 A 12,000, B 8.000. C 4,000. 5 At Flint Company's break-even point of 9,000 units, fixed costs are $180,000 and variable costs are $540,000 in total. The unit sales price is A) B) $20 $40 D) E) $80 $100