During its first year. Concord, Inc., showed a $21 per unit profit under absorption costing but would have reported a total profit of $16,800 less under variable costing. If production exceeded sales by 700 units and an average contribution margin of 60% was maintained, what is apparent: a. Fixed cost per unit? b. Sales price per unit? c. Variable cost per unit? C. d. Unit sales volume if total profit under absorption costing was $189,000?

During its first year. Concord, Inc., showed a $21 per unit profit under absorption costing but would have reported a total profit of $16,800 less under variable costing. If production exceeded sales by 700 units and an average contribution margin of 60% was maintained, what is apparent: a. Fixed cost per unit? b. Sales price per unit? c. Variable cost per unit? C. d. Unit sales volume if total profit under absorption costing was $189,000?

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter16: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 36P: Faldo Company produces a single product. The projected income statement for the coming year, based...

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Garrett Company provided the following information: Common fixed cost totaled 46,000. Garrett allocates common fixed cost to Product 1 and Product 2 on the basis of sales. If Product 2 is dropped, which of the following is true? a. Sales will increase by 300,000. b. Overall operating income will increase by 2,600. c. Overall operating income will decrease by 25,000. d. Overall operating income will not change. e. Common fixed cost will decrease by 27,600.
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