Cox Electric makes electronic components and has estimated the following for a new design of one of its products: Fixed cost = $10,000 Material cost per unit = $ 0.15 Labor cost per unit = $0.10 Revenue per unit = $ 0.65 These data are given in the file CoxElectric. Note that fixed cost is incurred regardless of the amount produced. Per-unit material and labor cost together make up the variable cost per unit. Assuming Cox Electric sells all that it produces, profit is calculated by subtracting the fixed cost and total variable cost rom total revenue. Create a spreadsheet model and construct a 1-way table and determine the breakeven point (use intervals of 10,000 units). Group of answer choices 20,000-30,000 10,000 - 20,000 30,000 - 40,000 25,000 30,000 20,000

Cox Electric makes electronic components and has estimated the following for a new design of one of its products: Fixed cost = $10,000 Material cost per unit = $ 0.15 Labor cost per unit = $0.10 Revenue per unit = $ 0.65 These data are given in the file CoxElectric. Note that fixed cost is incurred regardless of the amount produced. Per-unit material and labor cost together make up the variable cost per unit. Assuming Cox Electric sells all that it produces, profit is calculated by subtracting the fixed cost and total variable cost rom total revenue. Create a spreadsheet model and construct a 1-way table and determine the breakeven point (use intervals of 10,000 units). Group of answer choices 20,000-30,000 10,000 - 20,000 30,000 - 40,000 25,000 30,000 20,000

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

A firm has fixed costs of $25,000 associated with the manufacture of lawn mowers that cost $480 per mower to produce. The firm sells all the mowers it produces at $580 each. Find the cost, revenue and profit equations. Find the break-even quantity. (Let x be the number of mowers.)C(x) = R(x) = P(x) = break even quantity= ? mowers
Morris Industries manufactures and sells three products (AA, BB, and CC). The sales price and unit variable cost for the three products are as follows: Sales Price Variable Cost Product per Unit per Unit $30 AA $50 BB 35 10 CC 25 15 Their sales mix is reflected as a ratio of 5:3:2. Annual fixed costs shared by the three products are $253,500 per year. A. What are total variable costs for Morris with their current product mix? Total variable costs $ B. Calculate the number of units of each product that will need to be sold in order for Morris to break even. Number of Units per Product AA BB C. What is their break-even point in sales dollars? Break-even point in sales $ D. Using an income statement format, prove that this is the break-even point. If an amount is zero, enter "0". Income Statement Sales Product AA Product BB Product CC Total Sales Variable Costs Product AA Product BB Product CC Total Variable Costs $ Contribution Margin Fixed Costs Net Income
Carmen Co. can further process Product J to produce Product D. Product J is currently selling for $23.80 per pound and costs $16.00 per pound to produce. Product D would sell for $42.45 per pound and would require an additional cost of $9.80 per pound to produce. The differential cost of producing Product D is a. $7.84 per pound b. $11.76 per pound c. $5.88 per pound d. $9.80 per pound
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
Charleston Affair currently makes the King Component, incurring variable costs of $18 per unit and fixed costs of $4 per unit. The company has the option to purchase the component for $20 per unit. Prepare a differential analysis to determine if the company should make (Alternative 1) or buy (Alternative 2) the King Component. Assume that the fixed costs will be incurred in each situation up to 40,000 units. Determine at what want point of sales does it make sense to produce rather than buy)
Morris Industries manufactures and sells three products (AA, BB, and CC). The sales price and unit variable cost for the three products are as follows: Product Sales Priceper Unit Variable Costper Unit AA $45 $30 BB 35 10 CC 35 5 Their sales mix is reflected as a ratio of 5:3:2. Annual fixed costs shared by the three products are $189,000 per year. A. What are total variable costs for Morris with their current product mix? Total variable costs $fill in the blank b16d34fd6fb7fb3_1 B. Calculate the number of units of each product that will need to be sold in order for Morris to break even. Number ofUnits per Product AA fill in the blank BB fill in the blank CC fill in the blank C. What is their break-even point in sales dollars? Break-even point in sales $fill in the blank
Parker Co. can further process Product J to produce Product D. Product J is currently selling for $21 per pound and costs $15.75 per pound to produce. Product D would sell for $35 per pound and would require an additional cost of $8.75 per pound to produce. What is the net differential income of producing Product D? $7 per pound $8.75 per pound $15 per pound $5.25 per pound
Yasmin Co. can further process Product B to produce Product C. Product B is currently selling for $31 per pound and costs $29 per pound to produce. Product C would sell for $57 per pound and would require an additional cost of $23 per pound to produce. What is the differential cost of producing Product C? a. $29 per pound b. $57 per pound c. $31 per pound d. $23 per pound
Company E has two divisions, Division A and Division B. Division A is currently buying Component X from an external seller for $12. Division B produces Component X and has excess capacity. Using the following data, what would the transfer price per unit if Division A purchased Component X from Division B at the market-based transfer price? • Variable cost per unit $10 • Fixed cost per unit 1.16 • Division B sales price of Component X 14.50
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…
Bonita Company manufactures a product with a unit variable cost of $43 and a unit sales price of $75. Fixed manufacturing costs were $79500 when 7950 units were produced and sold, equating to $10 per unit. The company has a one-time opportunity to sell an additional 1000 units at $54 each in an international market, which would notaffect its present sales. The company has sufficient capacity to produce the additional units. How much is the relevant income effect of accepting the special order? $43000 $1000 $11000 $7950
Bramble Company manufactures a product with a unit variable cost of $41 and a unit sales price of $75. Fixed manufacturing costs were $79800 when 7980 units were produced and sold, equating to $10 per unit. The company has a one-time opportunity to sell an additional 1000 units at $54 each in an international market, which would not affect its present sales. The company has sufficient capacity to produce the additional units. How much is the relevant income effect of accepting the special order? $13000 $41000 $3000 $23940