Answered: a. Determine the firm’s fixed costs…

a. Determine the firm’s fixed costs that are expected next year. b. Calculate the firm’s break-even point in both units and pulas.

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter16: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 16E

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Question

Bonaventure Manufacturing expects to earn P210,000 next year after taxes. Sales will be
P4million. The firm manufactures a combined bookshelf and desk unit used extensively in
university dormitories. These units sell for P200 each and a have variable cost per unit of P150.
Bonaventure experiences a 30% tax rate.
a. Determine the firm’s fixed costs that are expected next year.
b. Calculate the firm’s break-even point in both units and pulas.

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