Cicero Manufacturing is growing and to support that growth it is studying three alternative combinationsof resources to increase capacity. Use the information below and cost-volume analysis to calculate theBreak-Even Point (BEP) in units for each of the capacity alternatives. Show work in the box and thetable below and round all answers to integer values.QBEP=Capacity Fixed RevenueAlternative Costsper UnitABC$1,300 $15.20$1,650 $15.20$2,250$15.20FCR-vVariableCostsper Unit$5.20$5.10$5.00Break-Even Point

The break units represent the number of units where the revenues are equal to the total cost. The…

Answered: Cicero Manufacturing is growing and to…

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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An automated turning machine is the current constraint at Jordison Corporation. Three products use this constrained resource. Data concerning those products appear below: LN JQ RQ Selling price per unit $ 167.36 $ 303.39 $ 411.96 Variable cost per unit $ 136.00 $ 212.11 5 303.18 Minutes on the constraint 1.60 5.60 7.40 Rank the products in order of their current profitability from most profitable to least profitable. In other words, rank the products in the order in which they should be emphasized. (Round your intermediate calculations to 2 decimal places)
Currently, the unit selling price of a product is $200, the unit variable cost is $160, and the total fixed costs are $408,000. A proposal is being evaluated to increase the unit selling price to $220. a. Compute the current break-even sales (units). 8,400 X units b. Compute the anticipated break-even sales (units), assuming that the unit selling price is increased and all costs remain constant. 5,600 X units
urrently, the unit selling price of a product is $410, the unit variable cost is $340, and the total fixed costs are $1,176,000. A proposal is being evaluated to increase the unit selling price to $460. a. Compute the current break-even sales (units).fill in the blank 1 of 1 units b. Compute the anticipated break-even sales (units), assuming that the unit selling price is increased and all costs remain constant.fill in the blank 1 of 1 units
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3. JJ Manufacturing builds and sells switch harnesses for glove boxes. The sales price and variable cost for each follows: Product Selling price per unit Variable cost per unit Trunk switch $60.00 $28.00 Gas door switch $75.00 $33.00 Glove box light $40.00 $22.00 Their sales mix is reflected in the ratio 4:4:1. What is the overall Composite Unit Contribution Margin for JJ Manufacturing with their current product mix? If annual fixed costs shared by the three products are $18,840, how many units of each product are to be sold in order for JJ Manufacturing to break even? Trunk Switch? Gas Door Switch? Glove Box Light? Determine their break-even point in sales dollars. Trunk Switch? Gas Door Switch? Glove Box Light?
Garida Co. is considering an investment that will have the following sales, variable costs, and fixed operating costs: Year 1 Year 2 Year 3 Year 4 Unit sales 4,200 4,100 4,300 4,400 Sales price $29.82 $30.00 $30.31 $33.19 Variable cost per unit $12.15 $13.45 $14.02 $14.55 Fixed operating costs $41,000 $41,670 $41,890 $40,100 This project will require an investment of $10,000 in new equipment. Under the new tax law, the equipment is eligible for 100% bonus deprecation at t = 0, so it will be fully depreciated at the time of purchase. The equipment will have no salvage value at the end of the project’s four-year life. Garida pays a constant tax rate of 25%, and it has a weighted average cost of capital (WACC) of 11%. Determine what the project’s net present value (NPV) would be under the new tax law. Determine what the project’s net present value (NPV) would be under the new tax law. $80,438 $67,032 $77,087 $60,329 Now…
Using the high low method, Hadley Company calculated the variable cost as $2.5 per unit. The high level of the activity was 2320 units and $38325 of total cost. Total fixed costs equal $ your answer as a whole number. 32.525 Moving to another question will save this response. Ent << Question 4 of
mpt in Progress mpany has a unit selling price of $505, variable costs per unit of $294, and fixed costs of $164,580. Calculate the break- n units using the mathematical equation and the contribution margin per unit. point in units using the mathematical equation point in units using the contribution margin per unit k and Media er units units Attempts: unlimited Submit Answer
Analyzing Income under Absorption and Variable Costing Variable manufacturing costs are $99 per unit, and fixed manufacturing costs are $215,600. Sales are estimated to be 7,700 units. If an amount is zero, enter "0". Round intermediate calculations to the nearest cent and your final answers to the nearest dollar. a. How much would absorption costing operating income differ between a plan to produce 7,700 units ard a plan to produce 9,800 units? b. How much would variable costing operating income differ between the two production plans? 0 Feedback Check My Work a. Remember that under variable costing, regardless of whether 7,700 units or 9,800 units are manufactured, no fixed manufacturing costs are allocated to the units manufactured. Instead, all fixed manufacturing costs are treated as a period expense. Therefore the change in units times the per unit fixed costs for the greater production level is the difference in income between the two costing methods. b. Remember that since all…
Required: Consider each part independently 1A. Determine the division’s expected ROI using Dupont formula. What is the division’s expected Residual Income? 1B. How many units must Smart sell to earn P100,000 Residual Income? 1C. The manager has the opportunity to sell additional 15,000 units at P29.50. Variable cost per unit would be the same but fixed cost would be increased by P50,000. An additional investment of P150,000 would be required. If the manager of Smart Division accepts the special order, by how much and in what direction will residual income change? increasing or decreasing direction? Answer 1a to 1c with solution pls
Can you please explain the statement with an example? Also, check whether my understanding of the example is correct. "If using the same unit fixed costs at different output levels, managers may reach erroneous conclusions. Total fixed costs should be used." My Understanding: For example, if the capacity is 1000 and currently we produce 1000 units and sell it for $20 per unit, variable cost $5 and the fixed cost $10 per unit (within the relevant range); and we have a special order to produce 1200 units for $8 per unit. Should we include additional the Total Fixed Cost of $10000, which is (10*1000) for the range (1001-2000) plus $10000 for the range (0-1000), which means, we will have a total fixed cost of $20000.
Management believes it can sell a new product for $7.50. The fixed costs of production are estimated to be $4,500, and the variable costs are $3.90 a unit. a. Complete the following table at the given levels of output and the relationships between quantity and fixed costs, quantity and variable costs, and quantity and total costs. Round your answers to the nearest dollar Enter zero if necessary. Use a minus sign to enter losses, if any Quantity Variable Costs Fixed Costs 0 500 1,000 $ $ $ S 2,500 $ 3,000 S 1,500 2,000 Total Revenue S Quantity $ $ Total Revenue $ $ $ $ $ $ $ $ $ S Fixed Costs $ $ Total Costs b. Determine the break-even level using the above table and use the Exhibit 19.5 to confirm the break even level of output. Round your answers for the break-even level to the nearest whole number. Round your answers for the fixed costs, variable costs, total costs, and profits (losses) to the nearest dollar. Enter zero if necessary Use a minus sign to enter losses, if any Variable…

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