Amy Company sells its single product at a price of $60 per unit and incurs thefollowing variable costs per unit of product:IDirect materialDirect laborManufacturing overhead$16127Variable manufacturing costs$35Selling expenses5Total variable costs$40Amy's annual fixed costs are $880,000, and Amy is subject to a 30% income tax rate.The number of units of product that Amy Company must sell annually to break evenis

A break-even point is a situation where the firm earns neither profit nor incurs any loss. In other…

Answered: Amy Company sells its single product at…

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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Similar questions

Morris Company is the exclusive distributor for an automotive product that sells for P40 per unit and has a CM ratio of 30%. The company's fixed expenses are P180,000 per year. The company plans to sell 16,000 units this year. Compute for the following: 1. Variable Expenses per unit. 2. Break-even point in unit sales. 3. Break-even point in Peso sales. 4. Unit Sales required to earn an annual profit of P60,00O. 5. Peso Sales required to earn an annual profit of P60,000.
The following annual information is for Dexter Corporation: Product A Revenue per unit: $20.00 Variable cost per unit: $15.00 Total fixed costs: $100,000 How many units does the company have to sell to achieve an after tax income of $75,000 if the income tax rate is 25%?
What is the difference between the trial balance and the balance sheet?
Maple Enterprises sells a single product with a selling price of $94 and variable costs per unit of $32. The company’s monthly fixed expenses are $15,846. What dollar sales will Maple need in order to reach a target profit of $22,657? Round to the nearest whole dollar, no decimals.
morning view industries manufactures and sells a product for $100 per unit. the annual fixed costs of manufacturing and selling the product are $85,840 and the variable costs are $65 per unit. the company’s break‑even point in units is
Rothe Company manufactures and sells a single product that it sells for $90 per unit and has a contribution margin ratio of 35%. The company's fixed expenses are $46,800. If Rothe desires a monthly target net operating income equal to 15% of sales, the number of sales in units will have to be (rounded)?
Finley Corporation has monthly fixed costs of $240,000. It sells two products for which it has provided the following information. Sales Price Product 1 $ Product 2 35 40 Contribution Margin $ 21 10 a. What total monthly sales revenue is required to break even if the relative sales mix is 20 percent for Product 1 and 80 percent for Product 2? (Hint: Determine the contribution margin ratio for each product.) b. What total monthly sales revenue is required to earn a monthly operating income of $105,000 if the relative sales mix is 60 percent for Product 1 and 40 percent for Product 2?
Coney Adventures Inc. sells one product for $5. The variable cost per item is $3, and the fixed costs for the firm are $40. Assume that the income tax rate for Redlands is 40%. Compute the number of units and sales revenue needed to achieve an $18 net profit. Compute the number of units and sales revenue needed to achieve an 8% profit margin. (Ignore income taxes.) Compute the number of units and sales revenue needed to achieve a 12% net profit margin. (Assume a 40% income tax rate.)
Leonard Corporation produces and sells 10,000 units of Product X each month. The selling price of Product X is $40 per unit, and variable expenses are $32 per unit. A study has been made concerning whether Product X should be discontinued. The study shows that $70,000 of the $120,000 in monthly fixed expenses charged to Product X would not be avoidable even if the product was discontinued. If Product X is discontinued, the annual financial advantage (disadvantage) for the company of eliminating this product should be: O ($30,000) O $30,000 O $40,000 O ($40,000)
Kerr Manufacturing sells a single product with a selling price of $600 with variable costs per unit of $360. The company's monthly fixed expenses are $72,000. A. What is the company's break-even point in units? B. What is the company's break-even point in dollars?
An annual fixed operating cost of P10,000,000 is incurred by a Auto Devices Manufacturing Company. Each device costs P1,375 to create and sells for P4,500. What is the annual break-even sales units for the manufacturer?
A CERTAIN PRODUCT SELLS FOR $55. IT HAS VARIABLE COSTS OF $33 PER UNIT AND FIXED COSTS OF $300,000 PER YEAR. HOW MANY THE PRODUCTS MUST COMPANY MANUFACTURE TO BREAK EVEN?

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