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EasyWriter manufactures an erasable ballpoint pen, which sells for $1.75 per unit. Management recently finished analyzing the resufts of the company's operations for the current month, At a break-even point of 40,000 units, the company's total variable costs are $50,000 and its total fixed costs amount to $20,000. a. Calculate the contribution margin per unit. (Round your answer to 2 decimal places.) b. Calculate the company's margin of safety if monthly sales total 45,000 units, c. Estimate the company's monthly operating loss if it sells only 38,000 units. d-1. Compute the total cost per unit at a production level of 40,000 pens per month. (Round your answer to 2 decimal places.) d-2 Compute the total cost per unit at a production level of 50,000 pens per month. (Round your answer to 2 decimal places.) Contribution margin per unit Margin of safety Operating loss b. e. d-1 Total cost per unit d-2 Total cost per unit

EasyWriter manufactures an erasable ballpoint pen, which sells for $1.75 per unit. Management recently finished analyzing the resufts of the company's operations for the current month, At a break-even point of 40,000 units, the company's total variable costs are $50,000 and its total fixed costs amount to $20,000. a. Calculate the contribution margin per unit. (Round your answer to 2 decimal places.) b. Calculate the company's margin of safety if monthly sales total 45,000 units, c. Estimate the company's monthly operating loss if it sells only 38,000 units. d-1. Compute the total cost per unit at a production level of 40,000 pens per month. (Round your answer to 2 decimal places.) d-2 Compute the total cost per unit at a production level of 50,000 pens per month. (Round your answer to 2 decimal places.) Contribution margin per unit Margin of safety Operating loss b. e. d-1 Total cost per unit d-2 Total cost per unit

FINANCIAL ACCOUNTING
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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ACCT 102 - Please Do All Subparts

EasyWriter manufactures an erasable ballpoint pen, which sells for $1.75 per unit. Management recently finished analyzing the results of the company's operations for the current month, At a break-even point of 40,000 units, the company's total variable costs are $50,000 and its total fixed costs amount to $20,000. a. Calculate the contribution margin per unit. (Round your answer to 2 decimal places.) b. Calculate the company's margin of safety if monthly sales total 45,000 units. c. Estimate the company's monthly operating loss if it sells only 38,000 units. d-1. Compute the total cost per unit at a production level of 40,000 pens per month. (Round your answer to 2 decimal places.) d-2 Compute the total cost per unit at a production level of 50,000 pens per month. (Round your answer to 2 decimal places.) a. Contribution margin per unit b. Margin of safety c. Operating loss d-1 Total cost per unit d-2 Total cost per unit
Transcribed Image Text:EasyWriter manufactures an erasable ballpoint pen, which sells for $1.75 per unit. Management recently finished analyzing the results of the company's operations for the current month, At a break-even point of 40,000 units, the company's total variable costs are $50,000 and its total fixed costs amount to $20,000. a. Calculate the contribution margin per unit. (Round your answer to 2 decimal places.) b. Calculate the company's margin of safety if monthly sales total 45,000 units. c. Estimate the company's monthly operating loss if it sells only 38,000 units. d-1. Compute the total cost per unit at a production level of 40,000 pens per month. (Round your answer to 2 decimal places.) d-2 Compute the total cost per unit at a production level of 50,000 pens per month. (Round your answer to 2 decimal places.) a. Contribution margin per unit b. Margin of safety c. Operating loss d-1 Total cost per unit d-2 Total cost per unit
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