European International has 3 separate business units in the following countries. Data for each of the business units are given below: France Spain Italy Selling price per unit £35 £38 £42 Manufacturing cost £4,000 per month plus £17 per unit £3,500 per month plus £18 per unit £5,000 per month plus £20 per unit Administrative expense £2,500 per month plus £2.50 per unit £2,900 per month plus £2.90 per unit £3,500 per month plus £3.50 per unit Sales commissions 15% of sales 16% of sales 20% of sales Advertising expense £2,000 per month £3,000 per month £2,000 per month If the business unit in Italy expects to produce and sell 5,000 units next month, the expected operating profit would be: £41,250. £42,750. £42,000. £40,000. If the business unit in Spain plans to produce and sell 4,000 units next month, the expected gross margin would be: £71,000. £77,000. £78,000. £76,500. 4 If the business unit in Italy plans to produce sell 3,000 units next month, the expected contribution margin would be: £34,750. £30,300. £26,500. £56,250.
1 European International has 3 separate business units in the following countries. Data for each of the business units are given below:
|
|
France |
Spain |
Italy |
|
Selling price per unit |
£35 |
£38 |
£42 |
|
|
£4,000 per month plus £17 per unit |
£3,500 per month plus £18 per unit |
£5,000 per month plus £20 per unit |
|
Administrative expense |
£2,500 per month plus £2.50 per unit |
£2,900 per month plus £2.90 per unit |
£3,500 per month plus £3.50 per unit |
|
Sales commissions |
15% of sales |
16% of sales |
20% of sales |
|
Advertising expense |
£2,000 per month |
£3,000 per month |
£2,000 per month |
If the business unit in Italy expects to produce and sell 5,000 units next month, the expected operating profit would be:
£41,250.
£42,750.
£42,000.
£40,000.
If the business unit in Spain plans to produce and sell 4,000 units next month, the expected gross margin would be:
£71,000.
£77,000.
£78,000.
£76,500.
4 If the business unit in Italy plans to produce sell 3,000 units next month, the expected contribution margin would be:
£34,750.
£30,300.
£26,500.
£56,250.
Total production costs for Gallop, Inc. are budgeted at £350,000 for 50,000 units of budgeted output and at £400,000 for 60,000 units of budgeted output. How much is Gallop's budgeted variable cost per unit of output?
£1.60
£1.67
£3.00
£5.00
6 Within a relevant range, the amount of variable cost per unit:
differs at each activity level.
remains constant at each activity level.
increases as activity increases.
decreases as activity increases.
7 The Blaine Company is a highly automated manufacturer. At an activity level of 6,000 machine setups, total
Assume that the relevant range includes all of the activity levels mentioned in this problem.
The total fixed overhead costs for Blaine Company are most likely closest to:
£112,000.
£120,000.
£40,000.
£80,000.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
