Suppose a company has 3 products. Product A has a contribution margin per unit of $15,product B has a contribution margin per unit of $25, and product C has a contribution margin perunit of $32. For every 3 units sold of product A the company sells 2 units of product B and 5units of product C. The company has fixed costs of $835,000. Suppose that the company wantsto make a profit of $3,500,000. How many units of each product must the company sell toachieve this goal?

Equation to determine the number of units of each product that the company must sell to achieve a…

Answered: Suppose a company has 3 products.…

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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Future Corporation has a single product; the product selling price is $100 and variable costs are $60. The company’s fixed expenses are $10,000. What is the company’s break-even point in sales dollars?
Solomon company has total fixed cost of $15,000, variable cost per unit of $6, and a price of $8. If Solomon wants to earn a target profit of $3,600, how many units must be sold? 2,500 7,500 9,300 18,600 18,750
A company's fixed operating costs are $360,000, its variable costs are $2.95 per unit, and the product's sales price is $5.10. What is the company's break-even point; that is, at what unit sales volume will its income equal its costs? Round your answer to the nearest whole number.
Fountain Corp. has a selling price of $14 per unit and variable costs of $9.80 per unit. When 18,000 units are sold, profits equaled $24,900. What is the margin of safety?
Wok of Fame, Inc., makes and sells woks at a price of $5.00 per unit. Variable cost is $3.00 per unit. The company's total fixed costs are $52,500. How much must total sales be if Wok of Fame wants to earn an operating income of $17,500? $100,000 $70,000 $175,000 $17,500 $26,250
1. Assume a company sells three different products. The contribution margin ratio of the first product is 20 percent. The contribution margin ratio of the second product is 50 percent. The contribution margin ratio of the third product is 80 percent. What is the range of the company's overall contribution margin ratio?
Finch Corporation produces products that it sells for $20 each. Variable costs per unit are $5, and annual fixed costs are $318,000. Finch desires to earn a profit of $51,000. Required a. Use the equation method to determine the break-even point in units and dollars. b. Determine the sales volume in units and dollars required to earn the desired profit. a. Break-even point in units a. Break-even point in dollars b. Sales volume in units b. Sales in dollars Prev 1 of 16 Next >

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