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Tigris Corporation has collected the following information after its first year of sales. Sales were $1,800,000 on 100,000 units; selling expenses $400,000 (30% variable and
Tigris Corporation has collected the following information after its first year of sales. Sales were $1,800,000 on 100,000 units; selling expenses $400,000 (30% variable and 70% fixed); direct materials $456,000; direct labor $250,000; administrative expenses $484,000 (50% variable and 50% fixed); manufacturing overhead $480,000 (40% variable and 60% fixed). Top management has asked you to do a CVP analysis so that it can make plans for the coming year. It has projected that unit sales will increase by 20% next year. Instructions: 1 point (1) Compute the contribution margin for the current year. 1 point (10) What is the margin of safety in dollars? O (A) $300000 O (B) $50000 O (C) $540000 O (D) $650000 (9) What is the variable cost ratio? 1 point O (A) 120% (B) 130% O (C) 10% O (D) 143% 1 (8) The company has a target net income of $213000.What is the required sales in units, for the company to meet its target, the tax rate is 20%? (A) 199306 O (B) 188305 O (C) 190000 O (D) 180000 (4) Compute the break-even point units. (A) 200000 (B) 250000 (C) 120000 (D) 150000 (5) Compute the break-even point sales dollars. (A) $2700000 O (B) $3000000 O (C) $2500000 (D) $4500000 (3) What are the total fixed costs for the current year? (Assume that fixed costs will remain the same in the next year.) (A) $410000 O (B) $810000 (C) $620000 (D) $720000 (4) Compute the break-even point in units. (A) 200000 (B) 250000 O (C) 120000
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