PART $1$

Fixed and Variable Cost Determinations

Unit Cost Calculations

The projected cost of a lamp is calculated based upon the projected increases or decreases to

current costs. The present costs to manufacture one lamp are:

Expected increases for $202$

When calculating projected increases round to TWO $($$$0\mathrm{.}00)$ decimal places.

Material Costs are expected to increase by $3\mathrm{.}00\%.$

Labor Costs are expected to increase by $4\mathrm{.}00\%.$

Variable Overhead is expected to increase by $4\mathrm{.}00\%.$

Fixed Overhead is expected to increase to $$285,000.$

Fixed Administrative expenses are expected to increase to $$60,000.$

Variable selling expenses $($measured on a per lamp basis$)$ are expected to increase

by $3\mathrm{.}00\%.$

Fixed selling expenses are expected to be $$31,000$ in $202.$

Variable administrative expenses $($measured a per lamp basis$)$ are expected to

increase by $2\mathrm{.}00\%.$

On the following schedule develop the following figures:

$1-20$x$2$ Projected Variable Manufacturing Unit Cost of a lamp.

$2-20$x$2$ Projected Variable Unit Cost per lamp.

$3-20$x$2$ Projected Fixed Costs.

PART $2$

Cost Volume Relationships $-$

Profit Planning

Big $Al$ is about to begin work on the budget for $202$ and they have requested that you prepare an analysis

based on the following assumptions.

Note: Remember, that we cannot sell part of a lamp, therefore to find the number of units you have to round

up to the next complete unit. Furthuremore, to find the required sales in dollars it may be easier to find the

number of units and then multiply by the selling price per unit

For $202$ the selling price per lamp will be $$45\mathrm{.}00.$ What is the projected contribution margin and contribution

$\{5\mathrm{.}01\}$

Contribution Margin Ratio $($Round to four places, $\%$ is two of those places ##$.$##$\%)$

$\{5\mathrm{.}02\}$

For $202$ the selling price per lamp will be $$45\mathrm{.}00.$ The desired net income in $202$ is $$205,000.$ What

would sales in units have to be in $202$ to reach the profit goal?

$\{5\mathrm{.}03\}$

For $202$ the selling price per lamp will be $$45\mathrm{.}00.$ If the fixed cost increase by $$40,000\mathrm{.}00$ how many lamps