Question
Use the data in following table to compute the DOL, the DFL, and DTL. Unit sales 1,000 5,000 Sales $5,000. $25,000 Less Variable cost -1,000
- Use the data in following table to compute the DOL, the DFL, and DTL.
| Unit sales | 1,000 | 5,000 |
| Sales | $5,000. | $25,000 |
| Less Variable cost | -1,000 | -5,000 |
| Less Fixed Cost | -2,000 | -2,000 |
| Earnings Before Interest and Taxes (EBIT) | 2,000 | $18,000 |
| Less Interest | -1,000 | -1,000 |
| Net Profits Before Taxes | $1,000 | $17,000 |
| Less Taxes | -400 | -6,800 |
| Net Profits After Taxes | $600 | $10,200 |
EPS (1000 shares outstanding) $0.60 $10.20
b. Fixed costs are $10,000. Variable costs are $4 per unit. Each unit sells for $5. How many units must be sold to break even?
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Principles Of Cost Accounting
Authors: Robert E. Schmiedicke, Charles F. Nagy, Edward J. Vanderback, E.J. Vanderbeck C.F. Nagy
9th Edition
0538812915, 978-0538812917
