Dolly sells two products: Y has a contribution margin ratio of 0.20 and Z has a contribution margin ratio of 0.80. A shift in the sales mix to more Product Z and less Product Y wi Increase the break-even point Reduce the break-even point No impact on the break-even point
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- 2.9 Company X and Company Y sells the same product for the same price. Company X has fixed costs of Birr 100 and variable costs of Birr 10 per unit. Company Y has fixed costs of Birr 200 and variable costs of Birr8. What is the unit sales price at which these companies will have the same break-even point in terms of unit sales?Bates Company plans to add a new item to its line of consumer product offerings. Two possible products are under consideration. Each unit of Product A costs $18 to produce and has a contribution margin of $9, while each unit of Product B costs $30 and has a contribution margin of $10. What is the differential revenue for this decision? Multiple Choice O O $21 $1 $13 $12Most businesses sell several products at varying prices. The products often have different unit variable costs. Thus, the total profit and the breakeven point depend on the proportions in which the products are sold. Sales mix is the relative contribution of sales among various products sold by a firm. Assume that the sales of Jordan Incorporated for a typical year are as follows: Product Units Sold Sales Mix A 18,320 80% B 4,580 20 Total 22,900 100% Assume the following unit selling prices and unit variable costs: Product Selling Price Variable Cost Contribution Margin A $ 90 $ 75 $ 15 B 150 110 40 Fixed costs are $420,000 per year. Assume that the sales mix, expressed in terms of relative physical units sold, is constant as sales volume changes. --Assume the original facts except that now fixed costs are expected to be $42,000 higher than originally planned. How does this expected increase in fixed costs affect the breakeven point in units? How does…
- Contribution Margin, Break-Even Sales, Cost-Volume-Profit Chart, Margin of Safety, and Operating Leverage Belmain Co. expects to maintain the same inventories at the end of 20Y7 as at the beginning of the year. The total of all production costs for the year is therefore assumed to be equal to the cost of goods sold. With this in mind, the various department heads were asked to submit estimates of the costs for their departments during the year. A summary report of these estimates is as follows: Estimated Estimated Variable Cost Fixed Cost (per unit sold) Production costs: Direct materials $50.00 Direct labor 30.00 Factory overhead $350,000 6.00 Selling expenses: Sales salaries and commissions 340,000 4.00 Advertising 116,000 Travel 4,000 Miscellaneous selling expense 2,300 1.00 Administrative expenses: Office and officers' salaries 325,000 Supplies 6,000 4.00 Miscellaneous administrative expense 8,700 1.00 Total $1,152,000 $96.00 It is expected that 12,000 units will be sold at a price…NUBD Co. manufactures and sells a single product. If the selling price and variable costs both decrease by 5% and fixed costs do not change, then the unit contribution margin will decrease and the contribution margin ratio will decrease the unit contribution margin will decrease and the contribution margn ratio will remain the same the unit contribution margin will remain unchanged and contribution margin ratio will decrease neither the unit contribution margin nor the contribution margin ratio will changeTime left 0:25 Each of a company's two product lines has a different contribution margin ratio. If the company's total sales remain the same but the sales mix shifts toward selling more of the product with the lower contribution ratio, which of the following is false? a. the breakeven point will increase. b. operating income will increase. С. Fixed cost will be constant. d. all of the answers are true. e. the average contribution margin ratio will decrease. On the cost-volume-profit graph, the area between the total cost line and the sales line before the break even point represents: a. The variable cost amount b. The contribution margin per unit
- stion Company XYZ produces and sells two types of calculators: Basic and Scientific. The Basic has a lower selling price per unit compared to the Scientific. However, the Basic has a higher contribution margin compared to the Scientific. Due to fixed production capacity, the company has a cap on total production ability. If the company's CEO has decided to shift the sales mix towards producing more Scientific calculators. What red would be the effect on total profits? d out of O a. Total profits would increase g O b. Total profits would decrease on Oc. Total profits would remain the same O d. None of the given answers O e. Cannot be determined using the above informationBefore a company reaches the breakeven point Select one: O-a. The fixed cost 1s egual to zero O b. Total fixed costs are increasing Oc The total contribution margin is lower than totalfixed costs O d. The total contribution margin is negative Oe The contribution margin per unit is higher than the fixed costs per unit3.Shugart sells two products. Product A sells for $56 with variable costs of $27. Product B sells for $147 with variable costs of $35. The sales mix is 29% for products A while product B's is the remainder (or 100% less 29. What is the weighted average unit contribution margin rounding to the nearest penny? As always, do not use $ signs.
- In a cost-volume-profit analysis, explain what happens at the break-even point and why companies do not want to remain at the break-even point. Marlin Motors sells a single product with a selling price of $400 with variable costs per unit of $160. The company’s monthly fixed expenses are $36,000. A. What is the company’s break-even point in units? B. What is the company’s break-even point in dollars? C. Prepare a contribution margin income statement for the month of November when they will sell 130 units. D. How many units will Marlin need to sell in order to realize a target profit of $48,000? E. What dollar sales will Marlin need to generate in order to realize a target profit of $48,000? F. Construct a contribution margin income statement for the month of February that reflects $200,000 in sales revenue for Marlin Motors.Gladstorm Enterprises sells a product for $46 per unit. The variable cost is $29 per unit, while fixed costs are $19,227. Determine the following: Round your answers to the nearest whole number. a. Break-even point in sales units fill in the blank 1 units b. Break-even point in sales units if the selling price increased to $58 per unit fill in the blank 2 unitsEach of a company's two product lines has a different contribution margin ratio . If the company's total sales remain the same but the sales mix shifts toward selling more of the product with the higher contribution ratio , which of the following is true ? O a Fixed cost will be constant . . the breakeven point will decrease . Ocall of the answers are true . d the average contribution margin ratio will increase . O e operating income will increase