Exercise 3-8A Target costing LO 3-2 The marketing manager of Campbell Corporation has determined that a market exists for a telephone with a sales price of $23 per unit. The production manager estimates the annual fixed costs of producing between 40,300 and 80,100 telephones would be $524,600. Required Assume that Campbell desires to earn a $125,000 profit from the phone sales. How much can Campbell afford to spend on variable cost per unit if production and sales equal 46,400 phones? Vanable cost per unit

Exercise 3-8A Target costing LO 3-2 The marketing manager of Campbell Corporation has determined that a market exists for a telephone with a sales price of $23 per unit. The production manager estimates the annual fixed costs of producing between 40,300 and 80,100 telephones would be $524,600. Required Assume that Campbell desires to earn a $125,000 profit from the phone sales. How much can Campbell afford to spend on variable cost per unit if production and sales equal 46,400 phones? Vanable cost per unit

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Question 10 High-Low Method Ziegler Inc. has decided to use the high-low method to estimate the total cost and the fixed and variable cost components of the total cost. The data for various levels of production are as follows: Units Produced Total Costs 6,820 $505,120 2,420 324,720 4,160 473,010 a. Determine the variable cost per unit and the total fixed cost. Variable cost: (Round to the nearest dollar.) $fill in the blank 1 per unit Total fixed cost: $fill in the blank 2 b. Based on part (a), estimate the total cost for 3,330 units of production. Total cost for 3,330 units: $fill in the blank 3
One Two Three Estimated customer demand in units 700 600 800 Selling price per unit Variable cost per unit Machine-hours per unit $ 80 $ 65 $ 26 $ 45 $ 20 $ 35 2.5 3.0 1.25 The company has only 1,200 machine-hours available. What is the highest total contribution margin that the company can earn if it makes optimal use of its constrained resource? Multiple Cholce $25,600 $24,600 $26,600 $23,600
Question 4 Ali Limited produces and sells two products. Product A sells for £12 per unit and has a total variable cost of £7.90, while Product B sells for £17 per unit and has a total variable cost of £11.20. For every 4 units of Product A sold, three of product B are sold. Ali Limited fixed costs are £131,850. Budgeted sales revenue is £428,500. Required: a) b) b) Calculate the Break-Even points in Units. Calculate the Margin of Safety in Units. Evaluate the relevance of Break-Even Analysis in decision making process.
Please do not give solution in image format thanku
Exercise 13-9A (Static) Using the contribution margin approach for a special order decision LO 13-2 Hensely Company, which produces and sells a small digital clock, bases its pricing strategy on a 25 percent markup on total cost. Based on annual production costs for 25,000 units of product, computations for the sales price per clock follow. Unit-level costs Fixed costs Total cost (a) Markup (a x 0.25) Total sales (b) Sales price per unit (b÷ 25,000) Required $240,000 60,000 300,000 75,000 $375,000 $15 a. Hensely has excess capacity and receives a special order for 8,000 clocks for $12 each. Calculate the contribution margin per unit. Based on this, should Hensely accept the special order? b. Prepare a contribution margin income statement for the special order. Complete this question by entering your answers in the tabs below. Required A Required B Hensely has excess capacity and receives a special order for 8,000 clocks for $12 each unit. Based on this, should Hensely accept the…
Unit VI question 6
Exercise 3-15A (Algo) Multiple product break-even analysis LO 3-6 Fanning Company manufactures two products. The budgeted per-unit contribution margin for each product follows: Sales price Variable cost per unit Contribution margin per unit Required Super $.92 (60) a. Total number of products b. Product Super b. Product Supreme $32 Supreme $ 127 Fanning expects to incur annual fixed costs of $199,100. The relative sales mix of the products is 70 percent for Super and 30 percent for Supreme. (81) units units units $.46 a. Determine the total number of products (units of Super and Supreme combined) Fanning must sell to break even. b. How many units each of Super and Supreme must Fanning sell to break even? Note: For all requirements, do not round intermediate calculations.
Exercise A-2 Absorption Costing Approach to Setting a Selling Price [LOA-2] Martin Company is considering the introduction of a new product. To determine a selling price, the company has gathered the following information: Number of units to be produced and sold each year 15,500 Unit product cost $ 50 Projected annual selling and administrative expenses $ 66,000 Estimated investment required by the company $ 450,000 Desired return on investment (ROI) 18 % The company uses the absorption costing approach to cost-plus pricing. Required: 1. Compute the markup required to achieve the desired ROI. ((Round your final answer to 2 decimal places (i.e., 0.1234 should be entered as 12.34).) 2. Compute the selling price per unit. (Round your intermediate and final answers to 2 decimal places. )