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High-Low Method for Service Company Miss River Railroad decided to use the high-low method and operating data from the past six months to estimate the
High-Low Method for Service Company Miss River Railroad decided to use the high-low method and operating data from the past six months to estimate the fixed and variable components of transportation costs. The activity base used by Miss River Railroad is a measure of railroad operating activity, termed "gross-ton miles," which is the total number of tons multiplied by the miles moved. Determine the variable cost per gross-ton mile and the fixed costs. Round variable cost per unit to the nearest cent. Variable cost per gross-ton mile Fixed cost a. Matzinger Company budgets sales of $1,190,000, fixed costs of $160,700, and variable costs of $714,000. What is the contribution margin ratio for Matzinger Company? % b. If the contribution margin ratio for Raynor Company is 40%, sales were $565,000, and fixed costs are $160,460, what is the operating income? Break-Even Sales BeerBev, Inc., reported the following operating information for a recent year (in millions): Assume that BeerBev sold 39 million barrels of beer during the year, that variable costs were 75% of the cost of goods sold and 50% of marketing, general and administration expenses, and that the remaining costs are fixed. For the following year, assume that BeerBev expects pricing, variable costs per barrel, and fixed costs to remain constant, except that new distribution and general office facilities are expected to increase fixed costs by $17.55 million. a. Compute the break-even sales (in barrels) for the current year. Round your answer to two decimal places. Enter your answers in millions. million barrels b. Compute the anticipated break-even sales (in barrels) for the following year. Round your answer to two decimal places. Enter your answers in millions. million barrels computer tablets. The unit selling price and the unit variable cost for each product are as follows: a. Compute the break-even sales (units) for the overall product, E. units b. How many units of each product, game players and tablets, would be sold at the break-even point
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