Quivers Inc. began operations on January 1 of the current year. The company produces eight-ounce bottles of jet wax called Ophelia Shine. The wax is sold wholesale in 12-bottle cases for $100 per case. There is a selling commission of $20 per case . The January direct materials , direct labor, and factory overhead costs are as follows:

	Part A. Break-even Analysis The management of Quivers Inc. wants to determine the number of cases required to break even per month. The utilities cost, which is part of factory overhead , is a mixed cost. The following information was gathered from the first six months of operation regarding this cost:
			Month	Case Production	Utility Total Cost
			January	500	$ 600.00
			February	800	$ 660.00
			March	1,200	$ 740.00
			April	1,100	$ 720.00
			May	950	$ 690.00
			June	1,025	$ 705.00
	Instructions
	1. Determine the fixed and variable portion of the utility cost using the high-low method.
	2. Determine the contrinution margin per case.
	3. Determine the fixed costs per month, including the utility fixed cost from question (1).
	4. Determine the break-even number of cases per month

Crearn base Natural oils Bottle (8-oz.) DIRECT MATERIALS Cost Units Cost Behavior per Case per Unit Variable 100 oz. $0.02 Variable 30 oz. 0.30 Variable 12 bottles 0.50 Direct Materials Cost per Case $ 2.00 9.00 6.00 $17.00 Department Mixing Filling Cost Behavior Variable Variable DIRECT LABOR Time per Case 20 min. 5 25 min. Labor Rate per Hour $18.00 14.40 Direct Labor Cost per Case $6.00 1.20 $7.20 FACTORY OVERHEAD Cost Behavior Total Cost Utilities Mixed $ 600 Facility lease Fixed 14,000 Equipment depreciation Fixed 4,300 Supplies Fixed 660 $19,560