Obj. 3 For the current year ended March 31, Cosgrove Company expects fixed costs of $27,600,000, aunit variable cost of $805, and a unit sclling price of S1,150.a. Compute the anticipated break-even sales (units).b. Compute the sales (units) required to realize operating income of $5,175,000.Obj. 5a. If Canace Company, with a break-even point at $960,000 of sales, has actual sales of $1,200,000,what is the margin of safety expressed (1) in dollars and (2) as a percentage of sales?b. If the margin of safety for Canace Company was 20%, fixed costs were $1,875,000, and variablecosts were 80% of sales, what was the amount of actual sales (dollars)? (Hint: Determine the break-even in sales dollars first.)

Ans to Obj.3 Working Particulars Amount $…

Answered: t variable cost o Compute the

Business

Accounting

t variable cost o Compute the

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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Concept explainers

Manufacturing Costs

Manufacturing cost is the total cost of procuring or producing a product. In other words, the manufacturing cost is the cost that an individual or business owner undertakes for the manufacturing of goods.

Question

Obj. 3 For the current year ended March 31, Cosgrove Company expects fixed costs of $27,600,000, a
unit variable cost of $805, and a unit sclling price of S1,150.
a. Compute the anticipated break-even sales (units).
b. Compute the sales (units) required to realize operating income of $5,175,000.
Obj. 5
a. If Canace Company, with a break-even point at $960,000 of sales, has actual sales of $1,200,000,
what is the margin of safety expressed (1) in dollars and (2) as a percentage of sales?
b. If the margin of safety for Canace Company was 20%, fixed costs were $1,875,000, and variable
costs were 80% of sales, what was the amount of actual sales (dollars)? (Hint: Determine the break-
even in sales dollars first.)

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