1. Werth Company produces tie racks. The estimated fixed costs for the year are $288,000, and the estimated variable costs per unit are $14. Werth expects to produce and sell 60,000 units at a price of $20 per unit.
|
A. |
|
Calculate the contribution margin ratio |
|
B. |
Calculate the contribution margin of each tie rack. |
|
|
C. |
|
Determine the break-even point in units. |
|
D. |
Determine Werth’s margin of safety ratio. |
|
2 – Donough Company had the following income statement:
|
Sales revenue (800 units) |
$80,000 |
|
|
Cost of goods sold: |
||
|
Fixed costs |
$20,000 |
|
|
Variable costs |
18,500 |
38,500 |
|
Gross profit |
$41,500 |
|
|
Operating expenses: |
||
|
Fixed costs |
12,000 |
|
|
Variable costs |
13,500 |
25,500 |
|
Operating income |
$16,000 |
|
A. How much is Donough’s contribution margin?
B. How many units must Donough sell in order to break even?
3 – Evans Company makes and sells cologne. This product has a unit sales price of $40 and a unit variable cost of $24. Fixed expenses are $32,000 per month.
1. Calculate the contribution margin ratio.
2. Calculate the contribution margin of each unit.
3. How many units must Evans sell to break even?
4. How much will total sales be at break even?
5. How much will total variable costs be at break even?
6. How many units must Evans sell in order to report income before taxes of $28,000?
7. If the company sells 3,500 units, how much is:
A. the total contribution margin?
B. income for the period?
C. The margin of safety in dollars?
D. Operating leverage?
8. Based on sales of 3,500 units, by what percentage would profit increase if sales increased by 20%?
4 – In Company manufactures and sells two products, Dings and Dongs. In provides you with the following:
|
|
Dings |
Dongs |
|
Selling price per unit |
$20 |
$16 |
|
Variable cost per unit |
10 |
12 |
Monthly fixed costs are $23,200. Thirty percent of sales each month are for Dings, while the remaining 70% are for Dongs.
A. Calculate the contribution margin per unit for each product.
B. Calculate the weighted-average contribution margin ratio
5 – Allen Company sells homework machines for $100 each. Variable costs per unit are $75 and total fixed costs are $62,000. Allen is considering the purchase of new equipment that would increase fixed costs to $84,000, but decrease the variable costs per unit to $60. At that level Allen Company expects to sell 3,000 units next year.
What is Allen’s break-even point in units if it purchases the new equipment?
How many units can Allen’s sales drop before he loses his ‘cushion’?
6- Aukens Company produces homework machines. During July of 2004, Aukens produced and sold 600 units at $40 per unit. At July’s level of production, it costs Aukens $18 variable costs per unit and fixed costs of $5 per unit. How much will total sales be if Aukens earns a profit of $8,000?
Try it now!
How it works?
Follow these simple steps to get your paper done
Place your order
Fill in the order form and provide all details of your assignment.
Proceed with the payment
Choose the payment system that suits you most.
Receive the final file
Once your paper is ready, we will email it to you.
Our Services
Custom Writings Help is a Quality-Oriented Company in Online Writing as a result of hiring exceptional professionals to execute clients' tasks.
Essays
At Custom Writings Help,We understand the struggle of research paper writing, and that is why at Custom WritingS Help, we are all out to help you. We pride ourselves on having a team of clinical writers. The stringent and rigorous vetting process ensures that only the 'BEST' Writers are chosen for the job. We have highly qualified Ph.D. and MA writers working with us; we equally offer these experienced writers specific bonuses and incentives to make them deliver highly original, unique, and informative content at reasonably low prices.
Admissions
Thesis Writing Service
Worlwide, Many Masters Students are struggling with Thesis Completion. A thesis is likely to be the longest and most challenging piece of work a student has ever completed. However, unlike essays and other assignments, a student can pick a particular interest topic and work on their initiative. Fortunately, we are there for you. At Custom Writings Help, you are assured of an authentic, imaginative, informative, linguistically great, and advantageous thesis that adheres to all your needs. So, why continue considering different writers when you have discovered the best in the field?
Editing
Custom Papers
Not a single student can avoid writing custom papers. However, a total lack of experience, skills, and time makes it very hard to produce a superb writing piece. Therefore, if you are seeking professional help, turn to us. Our specialized and experienced writers compose a variety of model papers, including custom essays, college term papers, research papers, book reports, MBA essays, executive summaries, dissertations, Ph.D. theses, admission essays, and research proposals for college and university students at any level.
Coursework
Essay Writing
Most of the students disregard the critical principles of essay writing and compose papers below sensible guidelines. Therefore, with Custom Writings Help, one should not worry about his/her essay. Our Writers compose informative and engaging content on all complexities and topics. We write meaningful and smart essays while prioritizing all aspects that bring about a good grade, such as impeccable grammar, proper structure, zero-plagiarism, and conformance to guidelines.
Coursework
Coourse Work Writing
Don't let the seemingly never-ending onslaught of writing assignments get you down. If you are looking where to get course work assistance online, the writers at Custom Writings Help are here to assist you with all of your writing needs. We undertake to unique delivery of papers that meet the professor's requirements. The content is proofread, edited, and checked plagiarism before submission to customers. No matter how big or small your work is, we will deliver on time. Try US Now! !
Coursework
Dissertation Writing Service
High-Quality Dissertation Writing Services are rare. They require Ph.D. academicians – not easily found. However, are an exception. The years, time, and resources we have invested in the dissertation world has given us a competitive advantage over others. Choose to come to Custom Writings Help; You will find perfect Ph.D. consultants who have written hundreds of dissertations theses ready to help you. Let our dissertation-writing services help you craft your dissertation, for you are assured we will give you the results.