Please do all four of these assignments correctly.

Ch. 11 Pre-Lecture Clicker Questions (ACCT 250) Name: _______________________ 1. Variable costs per unit _______________ regardless of changes in activity base. Total variable cost __________ in proportion to changes in activity base 2. Fixed costs are costs that ___________________________________________ 3. Calculate the contribution margin based on the following information: Sales Variable Costs Fixed Costs $20 per unit 100,000 units $12 per unit $300,000 4. Using the facts above calculate the contribution margin ratio 5. Calculate the breakeven point (in units) based on the information below: Sales Variable Costs Fixed Costs $20 per unit 100,000 units $12 per unit $600,000 Ch. 12 Pre-Lecture Clicker Questions (ACCT 250) Name: _______________________ 1. A sunk cost is a cost that ________________________________________________. 2. A company is considering using their equipment to manufacture and sell either cell phones or tablets. The estimated revenue that they could earn from each alternative is listed below: Product Line Cell Phones Tablets Estimated Revenue $850,000 $1,050,000 What is the amount of differential revenue that they could earn by selling tablets? 3. Using the same facts as above, if the differential costs to produce tablets compared to cell phones are $80,000, what is the amount of differential net income that would result from selling tablets? 4. Marley & Co. is currently purchasing one of their component parts for $200 per unit. However, their manufacturing plant is currently operating with excess capacity; therefore, they are considering making the part instead. The cost per unit of manufacturing the part internally is estimated as follows: (Hint - this is a Make or Buy Decision) Direct Materials Direct Labor Variable Manufacturing OH Fixed Manufacturing OH $90 $70 $25 $20 What is the differential cost to manufacture the component part? 5. Using the same facts as above, what is the cost savings from manufacturing the component part instead of purchasing it? Chapter 11 Blackboard Activity - ACCOUNTING 250 1. Given the following cost and activity observations for Landry Company's maintenance costs, use the high-low method to calculate Landry's Variable Costs per Unit and Fixed Costs per month: May June July August Cost $50,000 $72,000 $78,000 $64,000 Machine Hours 10,000 16,000 18,000 12,500 2. If Kyle Company's sales are $850,000, variable costs are $680,000, and fixed costs are $70,000, what is the company's contribution margin and contribution margin ratio? 3. Caldwell Corporation sells their product for $100 per unit, with a variable cost per unit of $85, and fixed costs of $750,000. What are the sales in units and dollars required to break-even? 4. Gerry & Sons has established a new product line and wants to sell their product for $120 per unit. If variable costs are 80% of sales, and fixed costs are $32,000, how many units does Gerry need to sell to earn a target profit of $40,000? Chapter 12/13 Activity - Accounting 250 1. Lease or Sell Decision: Pull Company is considering the disposal of equipment that is no longer needed for operations. The equipment originally cost $700,000, and accumulated depreciation to date totals $480,000. An offer has been received to lease the machine for its remaining useful life for a total of $425,000, after which the equipment will have no salvage value. The repair, insurance, and property tax expenses during the period of the lease are estimated at $82,500. Alternatively, the equipment can be sold through a broker for $270,000 less a 10% commission. Prepare a differential analysis on whether the equipment should be leased or sold. 2. Make or Buy Decision: Quick Company has been purchasing a component, Part Q, for $22 a unit. Quick is currently operating at 80% of capacity and no significant increase in production is anticipated in the near future. The cost of manufacturing a unit of Part Q, determined by absorption costing methods, is estimated as follows: Direct materials Direct labor Variable factory overhead Fixed factory overhead Total $13.50 6.25 1.25 3.75 $24.75 Prepare a differential analysis on the decision to make or buy Part Q. 3. Determine the selling price for the product using the total cost concept: Glover Inc. manufactures Product B, incurring variable manufacturing costs of $13.00 per unit and variable selling and administrative costs of $4 per unit and fixed manufacturing costs of $30,000 and fixed selling & administrative costs of $25,000. Glover desires a profit equal to a 15% rate of return on assets of $800,000 which are devoted to producing Product B. (Desired profit = 800,000*.15) The company is planning that 120,000 units are expected to be produced and sold. Follow the 7 steps to determine the selling price for Product B (Round the markup percent to 2 decimals - i.e. 5.23%) 4. Myers Company uses flexible budgeting for its Assembly Department. Using the information below, prepare a flexible budget for monthly production levels of 8,000 and 10,000 units. Materials $1.40 per unit Labor $2.00 per unit Fixed Costs $120,000 per month Other costs $3,000 per month + $0.45 per unit 8,000 units Variable costs Labor Materials Var. Other Costs Total Fixed costs Fixed Other Costs Total costs 10,000 units