A company has fixed costs of $320,000 and a contribution margin per unit of $15. If the company wants to earn income of $40,000, how many units must be sold?
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A company has fixed costs of $320,000 and a contribution margin per unit of $15. If the company wants to earn income of $40,000, how many units must be sold?
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- 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?Company A wants to earn $5,000 profit in the month of January. If their fixed costs are $10,000 and their product has a per-unit contribution margin of $250, how many units must they sell to reach their target income? A.20 B. 40 C. 60 D. 120Faldo Company produces a single product. The projected income statement for the coming year, based on sales of 200,000 units, is as follows: Required: 1. Compute the unit contribution margin and the units that must be sold to break even. Suppose that 30,000 units are sold above the break-even point. What is the profit? 2. Compute the contribution margin ratio and the break-even point in dollars. Suppose that revenues are 200,000 greater than expected. What would the total profit be? 3. Compute the margin of safety in sales revenue. 4. Compute the operating leverage. Compute the new profit level if sales are 20 percent higher than expected. 5. How many units must be sold to earn a profit equal to 10 percent of sales? 6. Assume the income tax rate is 40 percent. How many units must be sold to earn an after-tax profit of 180,000?
- Cadre, Inc., sells a single product with a selling price of $120 and variable costs per unit of $90. The companys monthly fixed expenses are $180,000. What is the companys break-even point in units? What is the companys break-even point in dollars? Prepare a contribution margin income statement for the month of October when they will sell 10,000 units. How many units will Cadre need to sell in order to realize a target profit of $300,000? What dollar sales will Cadre need to generate in order to realize a target profit of $300,000? Construct a contribution margin income statement for the month of August that reflects $2,400,000 in sales revenue for Cadre, Inc.Polaris Inc. manufactures two types of metal stampings for the automobile industry: door handles and trim kits. Fixed cost equals 146,000. Each door handle sells for 12 and has variable cost of 9; each trim kit sells for 8 and has variable cost of 5. Required: 1. What are the contribution margin per unit and the contribution margin ratio for door handles and for trim kits? 2. If Polaris sells 20,000 door handles and 40,000 trim kits, what is the operating income? 3. How many door handles and how many trim kits must be sold for Polaris to break even? 4. CONCEPTUAL CONNECTION Assume that Polaris has the opportunity to rearrange its plant to produce only trim kits. If this is done, fixed costs will decrease by 35,000, and 70,000 trim kits can be produced and sold. Is this a good idea? Explain.Suppose that a company is spending 60,000 per year for inspecting, 30,000 for purchasing, and 40,000 for reworking products. A good estimate of nonvalue-added costs would be a. 70,000. b. 130,000. c. 40,000. d. 90,000. e. 100,000.
- A company has fixed costs of $270,000, a contribution margin per unit is $14, and contribution margin ratio of 55%. If the company wants to earn a target income of $60,000, what amount of sales must it make?A company has fixed costs of $270,000, a contributmargin per unit of $14, and a contribution margin ratio of 55%. If the company wants to earn a target income of $60,000, what amount of sales must it make?if sales revenue is $35,000, fixed cost is $5,000, and net operation income is $10,000, what is the contribution margin?
- A company has total sales of $1,000,000, variable costs of $500,000, and fixed costs of $200,000. What is the contribution margin ratio?Suppose a company has 3 products. Product A has a contribution margin per unit of $15, product B has a contribution margin per unit of $25, and product C has a contribution margin per unit of $32. For every 3 units sold of product A the company sells 2 units of product B and 5 units of product C. The company has fixed costs of $835,000. Suppose that the company wants to make a profit of $3,500,000. How many units of each product must the company sell to achieve this goal?A company’s product sells for $150 and has variable costs of $60 associated with the product. What is its contribution margin per unit?