Currently, the unit selling price of a product is $390, the unit variable cost is $320, and the total fixed costsare $1,008,000. A proposal is being evaluated to increase the unit selling price to $440.a. Compute the current break-even sales (units).unitsb. Compute the anticipated break-even sales (units), assuming that the unit selling price is increased andall costs remain constant.units

Breakeven is the point at which an entity is in a position of no profit and no loss. At this point,…

Answered: Currently, the unit selling price of a…

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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Take into account the possibility of raising the cost of a good with an 8% profit margin. Calculate the effect of this price increase on the profit margin if you could raise the price by 1% while keeping the sales volume (in unit terms) at the same level as before the price increase. (Assume there are no fixed costs while answering this question. Only the percentage change in profit margin has to be calculated.)
If, Total Fixed cost OMR 32000, Selling price per unit OMR 20, and Variable cost per unit OMR 12. What will be the Margin of safety and profit if actual sales are OMR 85000? Select one: O a. Margin of Safety OMR 10000, Profit OMR 4000 O b. Margin of Safety OMR 26667, Profit OMR 16000 O c. None of the options O d. Margin of Safety OMR 5000, Profit OMR 2000
Assume the following (1) selling price per unit-$25, (2) variable expense per unit = $13, (3) unit sales=2,580, and (4) total fixed expenses = $25,000. Given these four assumptions, net operating income must be: Multiple Choice $8,540. O $39,500. O $27,580 $5.960.
AA Company produces and sells refrigerator magnets to be sold as novelty items by resorts. Last year, the company sold 198,400 units. The income statement for AA Company for last year is as follow: $992,000 545,600 $446,400 Sales Less: Variable expenses Contribution margin Less: Fixed expenses 180,000 $266,400 Operating Income How much was the margin of safety in revenue for last year? (Answer format: $123,456.78) * Your answer Suppose that the selling price decreases by 8 percent. How much is the revised breakeven point in units? (Answer format: 123.45) * Your answer
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Now suppose that annual unit sales, variable cost, and unit price are equal to their respective expected values—that is, there is no uncertainty. Determine the company's annual profit for this scenario. Round answer to a whole number, if needed.$
Show Me How E Print Item O eBook Break-Even Sales Currently, the unit selling price of a product is $370, the unit variable cost is $300, and the total fixed costs are $1,309,000. A proposal is being evaluated to increase the unit selling price to $410. a. Compute the current break-even sales (units). units b. Compute the anticipated break-even sales (units), assuming that the unit selling price is increased and all costs remain constant. units heck My Work 4 more Check My Work uses remaining. Previous All work saved. Email Instructor
The Selling Division’s unit sales price is P20 and its unit variable cost is P10. Its capacity is 10,000 units. Fixed costs per unit are P4. Current outside sales is 7,500 units. What is the maximum transfer price that the Purchasing Division would be willing to accept if 4,000 units will be sold to the Purchasing Division? Assume that the Purchasing Division can buy the same from outside market at P18.50 and that a cost of P1 per unit will be saved from the transfer. _____________________5. The Selling Division’s unit sales price is P20 and its unit variable cost is P10. Its capacity is 10,000 units. Fixed costs per unit are P4. Current outside sales is 10,000 units. What is the maximum transfer price that the Purchasing Division would be willing to accept if 4,000 units will be sold to the Purchasing Division? Assume that the Purchasing Division can buy the same from outside market at P18.50. _____________________6. The Selling Division’s unit sales price is P19 and its unit variable…
Assume total fixed costs of $160,000, variable costs per unit of $6, and contribution margin per unit of $4. How many units must be sold to meet a target net income of $50,000, assuming a tax rate of 20%?
Coronado Company has the following data:Variable costs are 80% of the unit selling price.The unit contribution margin is $400.The fixed costs are $596000.Which of the following expresses the break-even point in dollars? 0.20 x 596000 = X ($596000 ÷ $400) x 0.80 = X 596000 ÷ 0.80 = X $596000 ÷ 0.20 = X
If breakeven point is 1,100 units, each unit sells for $32, and fixed costs are $20,000, then on a graph the: > Total cost line will be zero at zero units sold > Total revenue line and the total cost line will intersect at $35,200 of revenue > Revenue line will start at $20,000 > Total revenue line and the total cost line will intersect at $55,200 of revenue

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