Question
Dupli-Pro Copy Shop provides photocopying service. Next year, Dupli-Pro estimates it will copy 3,150,000 pages at a price of $0.06 each in the coming year.
Dupli-Pro Copy Shop provides photocopying service. Next year, Dupli-Pro estimates it will copy 3,150,000 pages at a price of $0.06 each in the coming year. Product costs include:
Direct materials $0.009 Direct labor $0.003 Variable overhead $0.001 Total fixed overhead $90,540
There is no variable selling expense; fixed selling and administrative expenses total $42,000.
Required:
In your computations that involve the contribution margin ratio, do not round the ratio.1. Calculate the break-even point in units. fill in the blank 1 units
2. Calculate the break-even point in sales revenue. $fill in the blank 2
3. Calculate the margin of safety in units for the coming year. fill in the blank 3 units
4. Calculate the margin of safety in sales revenue for the coming year. $fill in the blank 4
5. What if the total selling and administrative expenses are reduced to $26,020? Recalculate the following:
a. Break-even point in units fill in the blank 5 units b. Break-even point in sales revenue $fill in the blank 6 c. Margin of safety in units for the coming year fill in the blank 7 units d. Margin of safety in sales revenue for the coming year $fill in the blank 8
Dupli-Pro Copy Shop provides photocopying service. Next year, Dupli-Pro estimates it will copy 3,150,000 pages at a price of $0.06 each in the coming year. Product costs include:
| Direct materials | $0.009 |
| Direct labor | $0.003 |
| Variable overhead | $0.001 |
| Total fixed overhead | $90,540 |
There is no variable selling expense; fixed selling and administrative expenses total $42,000.
Required:
In your computations that involve the contribution margin ratio, do not round the ratio.1. Calculate the break-even point in units. fill in the blank 1 units
2. Calculate the break-even point in sales revenue. $fill in the blank 2
3. Calculate the margin of safety in units for the coming year. fill in the blank 3 units
4. Calculate the margin of safety in sales revenue for the coming year. $fill in the blank 4
5. What if the total selling and administrative expenses are reduced to $26,020? Recalculate the following:
| a. Break-even point in units | fill in the blank 5 | units |
| b. Break-even point in sales revenue | $fill in the blank 6 | |
| c. Margin of safety in units for the coming year | fill in the blank 7 | units |
| d. Margin of safety in sales revenue for the coming year | $fill in the blank 8 |
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Entrepreneurship Successfully Launching New Ventures
Authors: Bruce R. Barringer, R. Duane Ireland
5th edition
133797198, 978-0133797190
