+ Template for EYK 6.1 (1) - Google x X Template for EYK 6.1 (1) (1).xIsx x + Template for EYK 6.1 (1) (1) - Go X + X docs.google.com/spreadsheets/d/1-mZdaQnXorynORHrMI9A3RiNADBuaGCShBmMR8NRZpA/edit#gid=2071217184 marion.k12.mi.us bookmarks M Inbox - morgan.wet.. = Google Docs Sis Grades and Attend.. Dashboard K! Kahoot! _] Classes @ Homepage - Mario. FD FoundationsDigital. Reading list Template for EYK 6.1 (1) (1) + & Share File Edit View Insert Format Data Tools Extensions Help Last edit was seconds ago 85% $ %% .0 .00 123- Default (Ca.. 1 . BISA A 31 A1 fx A B D E F G H 6 Do not just use a check figure as it will be marked incorrect unless the numbers support it 7 a Show math or calculatsion used 8 Increased revenue attributable to the special order (Hint: special unit X special C sales price) 10 Increased Costs: (Calculate the per unit variable cost) 11 Direct Material (formula provided) Formula provided free of charge on this one: (($1,720,000 / 400,000) - $1.80) + 12 Direct Labor 13 Variable Overhead 14 Selling Costs: 15 Commission 16 Total Per unit Variable Cost (DM, DL, Variable Overhead plus Commission) 17 Units in special order 18 Total variable costs 19 Contribution margin fom special order: 20 Incremental fixed costs 21 Increase in net income before taxes (Check Figure: total should equal $267,600) + EYK 6.1 - + O A 1 3 Sign out INTL 9 2:46+ Template for EYK 6.1 (1) - Google x X Template for EYK 6.1 (1) (1).xIsx x + Template for EYK 6.1 (1) (1) - Go X + X docs.google.com/spreadsheets/d/1-mZdaQnXorynORHrMI9A3RiNADBuaGCShBmMR8NRZpA/edit#gid=2071217184 marion.k12.mi.us bookmarks M Inbox - morgan.wet.. = Google Docs Sis Grades and Attend.. Dashboard K! Kahoot! _] Classes @ Homepage - Mario. FD FoundationsDigital. Reading list Template for EYK 6.1 (1) (1) + & Share File Edit View Insert Format Data Tools Extensions Help Last edit was seconds ago 85% * $ % .0 .00 123- Default (Ca.. * 11 BISA A 31 A1 fx A B C D E F G H 30 31 32 C 33 b Meeting a target profit: 34 35 Adjusted unit variable cost (w/reduced commission) HINT: Total Per Unit Variable Cost from above less the Commission Cost from above + 36 37 Total adjusted variable costs 38 Total increase in fixed costs 39 Desired net income before income before income taxes (this one is given for you) 39,600 40 Total cost (excluding commission) plus desired net income before income taxes 41 12 What is the lowest unit sales price PER UNIT they should receive and still make a 43 before-tax profit of $39,600 on the special order? Support your answer with the calculation 44 15 -+ EYK 6.1 - + O A Sign out INTL 2:47Assume that total fixed cost is $324,800. Compute the net income before income tax based on the sales volumes shown above. Compute the break-even point in total dollars of revenue and in specific unit sales volume for each product. ANSI Prove your break-even calculations by computing the total contribution margin related to your answer in requirement (b). 1. a, (p. 21 ENDING YOUR KNOWLEDGE YOUR LOG EYK6-1. Business Decision Case The following total cost data are for Ralston Manufacturing Company, which has a normal capacity per period of 400,000 units of product that sell for $18 each. For the Solut foreseeable future, regular sales volume should continue at normal capacity of production. y-interc Slope Total c $25,00ublishers 10.000 of fixed cost. What Cambridge Business Publishers Chapter 6 Cost-Volume-Profit Relationships 265 enue is to be $1,600,000? margin ratio is 60%, and enue? Direct materials. ............ $1,720,000 price is $50. What dollar Direct labor . . ............ . . . . 1, 120,000 Variable overhead . .. ........ 560,000 income tax rate is 40%? Fixed overhead (Note 1 ) . ...... . . . 880,000 Selling expense (Note 2) ...... . . . . facilities for the manu- . . . . . . 720,000 Administrative expense (fixed) 200,000 the following data are $5,200,000 Notes: 0 units 1. Beyond normal capacity, fixed overhead cost increases $30,000 for each 20,000 units or fraction thereof until a maximum capacity of 640,000 units is reached. unt 2. Selling expenses are a 10% sales commission. Ralston pays only one-half of the regular sales Unit Cost commission rates on any sale of 20,000 or more units. 000 $14.50 Ralston's sales manager has received a special order for 48,000 units from a large discount chain at a ,000 12.50 special price of $16 each, F.O.B. factory. The controller's office has furnished the following additional 000 6.40 cost data related to the special order: vwidsavd 000 3.80 1. Changes in the product's construction will reduce direct materials $1.80 per unit. 00 $37.20 2. Special processing will add 25% to the per-unit direct labor costs. 3. Variable overhead will continue at the same proportion of direct labor costs. 4. Other costs should not be affected. unit. Ignore income Required Present an analysis supporting a decision to accept or reject the special order. Assume Ralston's S regular sales are not affected by this special order. ring overhead and What is the lowest unit sales price Ralston could receive and still make a before-tax profit of $39,600 on the special order