35. X Co generates a 12 per cent contribution on its weekly sales of P280,000. A new product, Z, is to be introduced at a special offer price in order to stimulate interest in all the company's products, resulting in a 5 per cent increase in weekly sales of the company's other products. Product Z will incur a variable unit cost of P2.20 to make and PO.15 to distribute. Weekly sales of Z, at a special offer price of P1.90 per unit, are expected to be 3,000 units. The effect of the special offer will be to increase the company's weekly profit by: O a P330 Ob P780 O c P12,650 Od P19,700

35. X Co generates a 12 per cent contribution on its weekly sales of P280,000. A new product, Z, is to be introduced at a special offer price in order to stimulate interest in all the company's products, resulting in a 5 per cent increase in weekly sales of the company's other products. Product Z will incur a variable unit cost of P2.20 to make and PO.15 to distribute. Weekly sales of Z, at a special offer price of P1.90 per unit, are expected to be 3,000 units. The effect of the special offer will be to increase the company's weekly profit by: O a P330 Ob P780 O c P12,650 Od P19,700

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Weber Inc., sells its one product for $40 per unit. The variable cost per unit is $24. The fixed cost per year is $16,000a. What is the break-even point in units?b. What is the break-even point in dollars?c. If Weber would like to have $1,000 profit, how many units should be sold?d. If the selling price changes to $34 per unit, what is the new break-even point in units?
PAGE 1.1 NUBD Co. plans to market a new product. Based on its market studies. It estimates that it can sell 70,000 units in 2021. The selling price per unit is P2.00. Variable cost ratio is 40% of sales. Fixed costs are estimated to be P60,000. A.Compute the break-even point in units. B.Compute the break-even point in sales pesos.
For items 22 to 24: The Warner Company sells its only product for P30 and the variable costs amount to P21 per unit. Fixed cost for each year is P270,000. 22. Assuming the desired profit for next year (if all costs and selling price remains the same) is placed at P90,000, what is the margin of safety in units? A. 30,000 B. 20,000 C. 10,000 D. 40,000 23. What will be the projected sales in pesos with such desired profits of P90,000? A. P 900,000 B. P 1,200,000 C. P 300,000 D. P 600,000 24. If instead, the desired profit is 5% of sales, how many units must be sold to achieve such A. 36,000 B. 40,000 C. 25,714 D. 31500
D) Nuevo Company manufactures a product which sells for P5. At present, the company produces and sells 50,000 units per year. Unit variable manufacturing and marketing expenses are P2.50 and P.50 respectively. Fixed expenses are P70,000 for tactonY overhead and P30,000 for marketing and administration. The sales manager hos proposed that the price be increased to P6. To maintain the present sales volume. advertising must be increased. The company's profit objective is 10% of sales. 2. Compute the additional expenditure the company can afford for advertising. E) The annuUal FC amounted to P798,000. At present, the contribution margin ratio is 42%. 3. Determine the amount of sales if the desired profit is P173,800 net of the ff. fax rates: For the first P100,000 25% In excess of P100,000 35% F) Bosh Company expects to incur the following costs to produce and sell 70,000 units of its product: Variable manufacturing cost Fixed manufacturing cost Variable marketing expense Fixed marketing…
ABC Ltd produces a single product. The selling price is OMR 50 a unit and the variable costs is OMR 30 a unit. The annual fixed costs of the business are OMR 4000. The business aims to make OMR 10000 profit during the forthcoming year. How many units must be sold to achieve this target profit? Select one: a. 200 Units b. None of the options c. 700 Units d. 500 Units
Sinclair Company's product has a selling price of £25 per unit. Last year the company reported a profit of £20,000 and variable expenses totalling £180,000. The product has a 40% contribution margin ratio. Because of competition, Sinclair Company will be forced in the current year to reduce its selling price by £2.00 per unit. How many units must be sold in the current year to earn the same profit as was earned last year? Select one: O A. 15,000 units O B. 12,000 units O C. 16,500 units O D. 12,960 units
Lindon Company is the exclusive distributor for an automotive product that sells for $50.00 per unit and has a CM ratio of 30%. The company’s fixed expenses are $345,000 per year. The company plans to sell 27,200 units this year. Required: What are the variable expenses per unit? Note: Round your "per unit" answer to 2 decimal places. What is the break-even point in unit sales and in dollar sales? What amount of unit sales and dollar sales is required to attain a target profit of $195,000 per year? Assume that by using a more efficient shipper, the company is able to reduce its variable expenses by $5.00 per unit. What is the company’s new break-even point in unit sales and in dollar sales? What dollar sales is required to attain a target profit of $195,000?
Finley Corporation has monthly fixed costs of $67,000. It sells two products for which it has provided the following information. Contribution Sales Price Product 1 Product 2 $15 20 Margin $9 4 a. What total monthly sales revenue is required to break even if the relative sales mix is 30 percent for Product 1 and 70 percent Product 2? (Hint: Determine the contribution margin ratio for each product.) (Round your answer to the nearest dollar amount.) b. What total monthly sales revenue is required to earn a monthly operating income of $16,000 if the relative sales mix is 20 perce for Product 1 and 80 percent for Product 2? (Round your answer to the nearest dollar amount.) Answer is complete but not entirely correct. a. Break even sales revenue $ 190,625 b. Target sales revenue $275,000 B
Kerrigan Ltd makes and sells product A. The current selling price is £11 and the total of variable costs per unit is £6. The fixed costs of production are £350,000 and the company currently sells 75,000 units. Required: (a) Calculate the break-even point (in units and revenues) of product A for Kerrigan Ltd. ] (b) Calculate the profit made on sales of 75,000 units. [] (c) The company will make an advertising campaign costs £10,000 and will improve the product specifications, which will increase the variable cost per unit by £1. This is expected to allow the company to increase the selling price to £13 and the sales is expected to be 80,000 unites. Calculate the new profit figure for the improved product.