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t variable cost o Compute the

t variable cost o Compute the

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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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.)
Transcribed Image Text: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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