The Chimes Clock Company sells a particular clock for $40. The variable costs are $23 per clock and the breakeven point is 230 clocks. The company expectsto sell 280 clocks this year. If the company actually sells 430 clocks, what effect would the sale of additional 150 clocks have on operating income? Explain youranswer.The sale of an additional 150 clocks wouldoperating income by the amount ofThe total effect would amount to

Lets understand the basicsVariable costs are costs which changes with change in activity…

Answered: The Chimes Clock Company sells a…

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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(1) A company sells its products for $50 per unit. It has annual fixed cost of $300,000 and variable costs of $20 per unit. The company has a capacity to make 100,000 units per year. (a) How many units must be sold to breakeven? (b) What is the percentage of capacity at breakeven? (c) What is the profit at 25,000 units?
Clockmaker Ltd. makes a product called wallet. Managers from Clockmaker Ltd. want to achieve a profit of £82, 800. The wallet price equals £82 per unit. Each unit of wallet has a cost of £36 and annual total fixed costs equal £147, 200. Considering this information, which of the following statements is true? O a. To achieve the desired profit, Clockmaker Ltd. needs to sell 5, 000 units of wallet. O b. Clockmaker Ltd. would need to sell more than 3, 200 units of wallet to have positive profits. O c. Contribution per unit equals £46. O d. All the answers are true.
Braile Gear Works sells a single gear for a price of $73.00 per unit. The variable costs of the gear are $41.00 per gear and annual fixed costs are $548,800. Required: a. What is the break-even level of annual sales for Braile Gear Works? b. The cost analyst tells you that, based on the price and cost information of the gear and the marketing department's sales projection for next year, the margin of safety percentage is 30 percent. How many units does marketing expect to sell next year? Note: Do not round intermediate calculations. Break-even level Number of units to be sold parts
A company sells a toy for $12.80 each. The material, labour, and marketing costs add up to $1.00 per toy. The company also bears fixed costs of $10,100 per month related to this particular product. If the company produces and sells 850 toys each month, what is its monthly net income? Monthly net income = $ there is a loss.) (Enter your answer as negative if
Blackstone manufactures wrist watches. The selling price for each watch is $260. Fixed costs are currently $520,000. The current variable cost per unit is $100. Inflationary pressures have increased fixed costs to $620,000 and the variable cost per unit has increased by 10%. What is the new cost-volume-profit model/equation for the wrist watches?
The following are data on three promissory notes. Determine the missing amounts. (Round answers to O decimal places, e.g. 5,275. Use 360 days for calculation.) Maturity Date of Note Terms Date Principal (a) April 1 60 days $842,400 Annual Interest Rate 5 % $ (b) July 2 30 days 100,800 % (c) March 7 6 months 129,600 10 % $ 67 Total Interest $504
Can i please get help withthis question? Dannica Corporation produces products that it sells for $40 each. Variable costs per unit are $25, and annual fixed costs are $360,000. Dannica desires to earn a profit of $150,000. Required Use the equation method to determine the break-even point in units and dollars. Determine the sales volume in units and dollars required to earn the desired profit.
Carram Co produces one product. It currently sells 12,000 units per year at a price of $75 per unit. Carram Co has recently undertaken some market research which showed that for every increase in price of $5, annual sales demand would decrease by 1,000 units. What is the marginal revenue at an output level of 10,000 units (to the nearest $)? $
The Warren Watch Company sells watches for $26, fixed costs are$155,000, and variable costs are $13 per watch.a. What is the firm’s gain or loss at sales of 9,000 watches? At 15,000 watches?b. What is the break-even point? Illustrate by means of a chart.c. What would happen to the break-even point if the selling price was raised to $33?What is the significance of this analysis?d. What would happen to the break-even point if the selling price was raised to $33 butvariable costs rose to $24 a unit?
Friedman Co. is considering adding a new product. Based on preliminary market research, the company has decided that the price of the product should be $47. If the company's profit margin is 22 percent of revenues, what should the target cost be? $
How do I complete the following cost sheet for services still in process for Jones Audit?
Super Sales Company is the exclusive distributor for a high-quality knapsack. The product sells for $80 per unit and has a CM ratio of 40%. The company's fixed expenses are $360,000 per year. The company plans to sell 13,000 knapsacks this year. Required: 1. What are the variable expenses per unit? Variable expenses per unit 2. Use the equation method for the following: a. What is the break-even point in units and in sales dollars? Break-even point in units Break-even point in sales dollars

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