Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Company ABC presents the following information about the sales of its product: Sale Price $40.00 per unit Variable Costs $25.00 per unit Fixed Costs (total).

Company ABC presents the following information about the sales of its product:

Sale Price $40.00 per unit Variable Costs $25.00 per unit Fixed Costs (total). $60,000

In 2023 the company sold 15,000 units. Required:

1. Determine the contribution margin per unit and total contribution margin.

2. Determine the tie point in units and in dollars.

3. Determine the company's margin of safety.

4. Determine the units that must be sold and the sales in dollars to make a profit of $300,000.

5. ABC wants to know by how much the firm's net income would increase with an increase in sales ($) of $55,000. To achieve that increase, additional fixed costs of $13,000 will be incurred.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

A Guide To Project Auditing

Authors: Association For Project Management

1st Edition

1903494745, 978-1903494745

More Books

Students also viewed these Accounting questions

Question

3. Yesim is really supportive when other students are upset.

Answered: 1 week ago

Question

1. Identify three approaches to culture.

Answered: 1 week ago

Question

3. Identify and describe nine cultural value orientations.

Answered: 1 week ago

Question

4. Describe how cultural values influence communication.

Answered: 1 week ago