3- Suppose that a company has a normal capacity of production of 200.000 meters of a textile product. It worked under full capacity and sold every product within the year. There are no inventories neither in the beginning nor in the end of the period. Here are the following data: (a) Sales price (TL/meters) 50, (b) Unit variable cost (TL/meters) 30, (c) Total fixed costs (TL/year) 1.80o.000. What would be the margin of safety ratio if the company employs variable costing? O 50% O 55% O 60% O 65%

3- Suppose that a company has a normal capacity of production of 200.000 meters of a textile product. It worked under full capacity and sold every product within the year. There are no inventories neither in the beginning nor in the end of the period. Here are the following data: (a) Sales price (TL/meters) 50, (b) Unit variable cost (TL/meters) 30, (c) Total fixed costs (TL/year) 1.80o.000. What would be the margin of safety ratio if the company employs variable costing? O 50% O 55% O 60% O 65%

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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3. Suppose that a company has fixed costs of $18 per unit and variable costs $9 per unit when 15,000 units are produced. What are the fixed costs per unit when 12,000 units are produced? PLEASE NOTE: Costs per unit dollar amounts will be rounded to two decimal places and shown with "$" and commas as needed (i.e. $12,345.67).
Determinant Company is a price−taker and uses a target−pricingapproach. Refer to the following information: Production volume 602,000 units per year Market price $34 per unit Desired operating income 17% of total assets Total assets $13,800,000 What is the target full product cost in total for the year? Assume all units produced are sold. Question content area bottom Part 1 A. $13,800,000 B. $18,122,000 C. $2,346,000 D.$ 102, 340
Thornton Manufacturing Company reported the following data regarding a product it manufactures and sells. The sales price is $44. 12 Variable costs Manufacturing Selling Fixed costs Manufacturing Selling and administrative 17 per unit 6 per unit $152,000 per year $102,100 per year Required a. Use the per-unit contribution margin approach to determine the break-even point in units and dollars. b. Use the per-unit contribution margin approach to determine the level of sales in units and dollars required to obtain a profit of $178,500. c. Suppose that variable selling costs could be eliminated by employing a salaried sales force. If the company could sell 21,400 units, how much could it pay in salaries for salespeople and still have a profit of $178,500? (Hint Use the equation method.) a. Break-even point in units Break-even point in dollars b Required sales in units Required sales in dollars C Fixed cost of salaries
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Suppose a company has fixed costs of $47,600 and variable cost per unit of ². +222 dollars, where x is the total number of dollars per unit. units produced. Suppose further that the selling price of its product is 1656- (a) Find the break-even points. (Enter your answers as a comma-separated list.) x= (b) Find the maximum revenue. (Round your answer to the nearest cent.) $ (c) Form the profit function P(x) from the cost and revenue functions. P(x) Find maximum profit. (d) What price will maximize the profit? (Round your answer to the nearest cent.)
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PROBLEM SOLVING 1. ABC Mfg. Co. buy and sells its lone product on which the following data are given: Sales volume per annum Unit selling price Production cost per unit: Direct materials Direct labor Variable factory overhead Fixed factory overhead (P25,000/20,000 units) Variable operating expense per unit Fixed operating expenses (P10,000/20,000 units) P1.00 0.50 a. Should the order be accepted? Why? 25,000 units P10.00 P3.50 2.50 2.00 1.25 A special order is received for P2,000 units from a remote market at P7.90, FOB destination. Packing and shipping costs are estimated at P1,200. Decision making: (show computation) b. What is the BEP price or sales cut-off price for the special order?
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