Units soldPriceSalesVariable manufacturing costsFixed manufacturing costsVariable selling costsFixed administrative costsMargin of safetyMargin of safety ratio1,000$ 10$ 10,0004,000Required:Using the data provided, compute the margin of safety and margin of safety ratio.%2,0001,0001,000

Margin of safety is the amount which is determined by the entity by deducting the breakeven sales…

Units sold Price Sales Variable manufacturing costs Fixed manufacturing costs Variable selling costs Fixed administrative costs Required: Using the data provided, compute the margin of safety and margin of safety ratio. Margin of safety Margin of safety ratio 1,000 $ 10 $ 10,000 4,000 2,000 1,000 1,000 %

Units sold Price Sales Variable manufacturing costs Fixed manufacturing costs Variable selling costs Fixed administrative costs Required: Using the data provided, compute the margin of safety and margin of safety ratio. Margin of safety Margin of safety ratio 1,000 $ 10 $ 10,000 4,000 2,000 1,000 1,000 %

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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REQUIREDStudy the information given below and answer each of the following questions INDEPENDENTLY:3.1 Calculate the margin of safety (in units). 3.2 Calculate the total Contribution Margin and Operating Profit/Loss, if the direct materialsare expected to cost R30 per unit more and fixed manufacturing overhead costs are 10%greater than projected. 3.3 Calculate the variable cost per unit to break even, if the fixed costs and selling price perunit remain the same but the break-even quantity changes to 6 000 units. 3.4 Use the contribution margin ratio to determine the level of sales in Rands required toobtain an operating profit of R1 950 000. 3.5 Alpha Limited wants to eliminate the variable selling expenses by employing a salariedsales force. If the company sells 14 250 units, how much could it pay in salaries to thesales staff and still have a profit of R16 800 000? INFORMATIONAlpha Limited manufactures and sells its own brand of guitars. Each guitar sells for R3 000 and the…
12. A company has produced the following information for a product it is about to launch: Units Variable production cost per unit Fixed production costs Variable selling cost per unit Fixed selling price Administrative costs What is the life-cycle cost per unit? A. £4.81 B. £4.32 C. £5.07 D. £5.48 4000 £4.30 £5,000 A. Prime cost +60% B. Marginal cost+40% C. Average Total Costs +10% D. Net margin of 20% on selling price. £0.70 £1700 £900 7000 £3.80 £5,500 £0.60 £1800 £900 9000 £3.20 £6,000 £0.60 £1800 £900 13. A product has a prime cost of £15, variable overhead of £5 per unit and fixed overheads of £8 per unit. Which pricing policy gives the highest price?
Time left 1:46 Which of the following statements about CVP analysis is false? O a. Unit selling price, unit variable costs, and total fixed costs are known and remain constant. Ob. All of the given answers are true. Oc. Managers use (CVP) analysis to study the behavior of and relationship among the elements such as total revenues, total costs, and income O d. Total revenues and total costs are linear in relation to output units. O e. Operating income calculations in CVP analysis are based on contribution margin not gross margin. 14:13 A O A d0 ENG 15-04-2021 re to search hp end brt sc delete home & num 23 + backspace 24 4. lock 8. 3. 6 7 V 8 A home enter 5 0 D F G J K L. pause 51 B ↑ shift 11 2 N M end alt ctrl ins
3. Compute the margin of safety. Margin of safety in dollars Margin of safety percentage 4. Compute the degree of operating leverage. Sales Variable expenses Contribution margin Fixed expenses Net operating income Degree of operating leverage $3,300 146.67%
Understanding CVP relationships Calculate the missing amounts for each of thefollowing firms:Units Selling Variable Costs Contribution Fixed OperatingSold Price per Unit Margin Costs Income (Loss)Firm A 11,200 $24.00 ? $100,800 $41,300 ?Firm B 8,400 ? $18.20 ? 64,500 $32,940Firm C ? 7.30 4.20 10,850 ? (6,750)Firm D 4,720 ? 51.25 41,064 48,210 ?
G http Chapter Review My... Sales price Contribution margin ratio Fixed costs Tra.. Vernon Company reported the following data regarding the product it sells: a. Break-even point in dollars a. Break-even point in units b. Sales in dollars b. Sales in units c. Break-even point in dollars c. Break-even point in units $60 Man... $ 10% $216,000 M Questio... Required Use the contribution margin ratio approach and consider each requirement separately. b Ans... 2,160,000 36,000 Bes... Saved a. What is the break-even point in dollars? In units? b. To obtain a profit of $54,000, what must the sales be in dollars? In units? c. If the sales price increases to $72 and variable costs do not change, what is the new break-even point in dollars? In units? US fron.
Unit sales (a) Selling price per unit Variable cost per unit Traceable fixed expense TB MC Qu. 12A-46 Woodridge Corporation manufactures numerous... Woodridge Corporation manufactures numerous products, one of which is called Alpha-32. The company has provided the following data about this product Multiple Choice $1,375,220 77,000 76.00 61.00 $1,323,000 $52.220 Help $ $ Management is considering increasing the price of Alpha-32 by 5%, from $76.00 to $79.80. The company's marketing managers estimate that this price hike would decrease unit sales by 5%, from 77,000 units to 73,150 units Assuming that the total traceable fixed expense does not change, what net operating income will product Alpha-32 earn at a price of $79.80 if this sales forecast is correct? Save & Exit
Required information Tableau Dashboard Activity: Calculate and Communicate 13-1 (Static) [Exercise 13-13; LO13-5] Benoit Company produces three products-A, B, and C. Data concerning the three products follow (per unit): Selling price Variable expenses: Direct materials Other variable expenses Total variable expenses Contribution margin Contribution margin ratio A Product B C $ 80 $ 56 $ 70 24 15 9 24 27 40 48 42 49 $ 32 $ 14 $ 21 40% 25% 30% The company estimates that it can sell 800 units of each product per month. The same raw material is used in each product. The material costs $3 per pound with a maximum of 5,000 pounds available each month. Tableau Dashboard Activity 13-1 (Static) Part 1 Required: 1. Calculate the contribution margin per pound of the constraining resource for each product. Note: Round your answers to 2 decimal places. Product A Product B Product C Contribution margin per pound of the constraining resource
Variable costs: Manufacturing Sales commission Total variable costs Fixed costs (allocated): Manufacturing Selling and administrative Total fixed costs Total costs Variable manufacturing cost per unit E20.24 Absorption cost per unit Total variable cost per unit = = $400 $192000-480 = ($192000-$120000)- 480 = ($192000-124000)-480 =$450 = 5650 $192 000 $ 24 000 $120 000 $48 000 $216 000 $168 000 $384 000 Determining markup percentage; target ROI: manufacturer LO 20.3 Refer to the cost and production data for the Wave Darter in Exhibit 20.4. The target profit is $110 000. Required Use the general formula to calculate the required markup percentages for each of the following cost- plus formulas: 1. variable manufacturing cost 2. absorption cost.
Cost Volume Profit (CVP) Relationships (Algo) You are provided with the following data. Unit sales Selling price per unit Variable expenses per unit Fixed expenses Target Profit 80,000 units $70 per unit $ 28 per unit $ 2,688,000 $ 1,610,000 Required: Compute the CM ratio and variable expense ratio. Compute the break-even. Compute the target profit. Compute the margin of safety with the original data. Compute the degree of operating leverage with the original data. Use the Degree of Operating Leverage to determine the new Net Operating Income if sales increase by: 16% 1. Use the Open Excel in New Tab button to launch this question. 2. When finished in Excel, use the Save and Return to Assignment button in the lower right to return to Connect.
Compute the contribution margin ratio and fixed costs using the following data. Sales $4,600 Variable costs $ 2,944 Income $ 540 Less: Sales Variable cost Contribution margin Numerator: Fixed Cost 1 Contribution Margin $ Contribution Margin Ratio Denominator: 1 4,600 2,944 = Contribution Margin Ratio Contribution margin ratio 0
Determine the missing amounts. 1. 2. 3. $ Unit Selling Price $800 $350 (e) $ $ Unit Variable Costs $336 (c) (f) $ Unit Contribution Margin $147 $800 (a) Contribution Margin Ratio % (b) % (d) 40 %