Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Viejol Corporation has collected the following information after its first year of sales. Sales were $1,600,000 on 100,000 units, selling expenses $240,000 (40% variable and

Viejol Corporation has collected the following information after its first year of sales. Sales were $1,600,000 on 100,000 units, selling expenses $240,000 (40% variable and 60% fixed), direct materials $514,000, direct labor $270,800, administrative expenses $280,000 (20% variable and 80% fixed), and manufacturing overhead $376,000 (70% variable and 30% 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 10% next year.

image text in transcribedimage text in transcribed

Your answer is correct. Compute (1) the contribution margin for the current year and the projected year, and (2) the fixed costs for the current year. (Assume that fixed costs will remain the same in the projected year.) (1) Contribution margin for current year 400,000 440,000 480,800 Contribution margin for projected year (2) Fixed Costs SHOW SOLUTIONSHOW ANSWER LINK TO TEXT LINK TO TEXT LINK TO TEXT Attempts: 1 of 3 used (b) Your answer is correct. Compute the break-even point in units and sales dollars for the current year. (Round intermediate calculations to 2 decimal places e.g. 2.25 and final answers to O decimal places, e.g. 1,225.) Break-even point in units Break-even point in dollars 120,200 units 1,923,200

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Auditing

Authors: Karla M. Johnstone, Audrey A. Gramling, Larry E. Rittenberg

8th International Edition

0538477660, 978-0538477666

More Books

Students also viewed these Accounting questions