Hank Company has recently leased facilities for the manufacture of a new product. Based on studies...

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Hank Company has recently leased facilities for the manufacture of a new product. Based on studies made by its accounting personnel, the following data are available: Estimated annual sales: 18,000 units Amount Unit Cost Estimated Costs: Direct materials $186,300 $10.35 Direct labor 177,120 $9.84 Manufacturing overhead 105,840 $5.88 Administrative expenses 66,960 $3.72 $536,220 $29.79 Selling expenses are expected to be 10% of sales, and the selling price is $38.00 per unit. Ignore income taxes in this problem. a. Compute a break-even point in dollars and in units. Assume that manufacturing overhead and administrative expenses are fixed, but that other costs are variable. Use the contribution margin ratio percent, rounded to one decimal place, in your calculation of break-even in sales dollars. Round final answers to whole numbers. In units In sales $ Break-even 0 0 b. What would net income before income tax be if 27,000 units were sold? $ 0 c. How many units must be sold to earn a net income before income tax of 15% of sales? TIP: Determine the minimum number of units assuming Hank does not sell partial units. 0 Hank Company has recently leased facilities for the manufacture of a new product. Based on studies made by its accounting personnel, the following data are available: Estimated annual sales: 18,000 units Amount Unit Cost Estimated Costs: Direct materials $186,300 $10.35 Direct labor 177,120 $9.84 Manufacturing overhead 105,840 $5.88 Administrative expenses 66,960 $3.72 $536,220 $29.79 Selling expenses are expected to be 10% of sales, and the selling price is $38.00 per unit. Ignore income taxes in this problem. a. Compute a break-even point in dollars and in units. Assume that manufacturing overhead and administrative expenses are fixed, but that other costs are variable. Use the contribution margin ratio percent, rounded to one decimal place, in your calculation of break-even in sales dollars. Round final answers to whole numbers. In units In sales $ Break-even 0 0 b. What would net income before income tax be if 27,000 units were sold? $ 0 c. How many units must be sold to earn a net income before income tax of 15% of sales? TIP: Determine the minimum number of units assuming Hank does not sell partial units. 0

Answer rating: 100% (QA)

Answer Lets solve each part step by step a Compute BreakEven Point First calculate the contribution margin per unit Contribution Margin per Unit Selli... View the full answer