Answered: What is the break-even point in sales…

What is the break-even point in sales for 1993? b. Calculate the profit or loss if 130,000 of the units are sold in 1993.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Last year a local restaurant realized sales of $290,000 with fixed costs of $130,000 and total…

A: Break even sales: Sales at which there will be no profit or loss. The restaurant can recover fixed…

Q: XYZ Company is facing changes in its cost structure so that fixed costs will decrease from $600,000…

A: The correct option is:- It will Increase .d

Q: The Poseidon Swim Company produces swim trunks. The average selling price for one of their swim…

A: The break-even points point in units can be found by using the following formula:The dollar value…

Q: For the past year, LaPrade Company had fixed costs of $70,000, a unit variable costs of $32, and a…

Q: al fixed expenses were $30,000 for the s are expected to increase to $36,000, r unit will remain…

A: Net Operating Income = Total Contribution - Fixed Expenses Contribution margin is the sales less…

Q: What would happen to the company's profit if the changes were implementedand production decreased to…

A: The correct answer is b. It will decrease

Q: Spice Inc.'s unit selling price is $53, the unit variable costs are $34, fixed costs are $101,000,…

A: Income statement is a financial statement that shows the profitability, total revenue and total…

Q: a- What is the breakeven quantity for this product using graphical method. b- What is the marginal…

Q: 20 Hsu, Inc. sells a single product for $12. Variable oosts are $8 per unit and total 5360,000 at a…

A: Contribution margin per unit = sales price per unit = variable cost per unit = $12 - $8 = $4 per…

Q: If Kirwan Company, with a break-even point at $527,000 of sales, has actual sales of $850,000, what…

A: The break even sales are calculated as fixed costs divided by contribution Margin Ratio. The margin…

Q: XYZ Company is facing changes in its cost structure so that fixed costs will decrease from $800,000…

A: Net income can be defined as the difference between total revenues and total expenses. Expenses can…

Q: JUDOS por day. FIXBU COSIS are $29,000 and thế variable costs for manufacturing 60 bottles are…

A: The contribution margin is calculated as difference between sales and variable costs. The fixed…

Q: A company that produces cameras has fixed costs of $153,000 per annum. The variable costs are 45% of…

A: Profit is amount available after deduction of the fixed cost and variable cost from the sales and is…

Q: Techiefy Co. wants to launch a new product. it is observed that the fixed cost of the new product is…

A: Cost function = 35,000 + 500D Revenue function = 5000D-100 D2 Profit function at breakeven =…

Q: Your Company's single product has a selling price of $15 per unit. Last year the company variable…

A: Given information, Selling price=$15 per unit Variable cost= $9 per unit Fixed expenses =$90,000 Net…

Q: Drake Company produces a single product. Last year's income statement is as follows: Sales (21,000…

A: Break even point : It refers to that point where total cost is equal to total revenue, i e. It is…

Q: 0 $/unit). The company wanted to explore the possibi creasing its profits, so it decided to spend…

A: Profit of the company depends on the variable cost and fixed cost and the amount of sales and the…

Q: 3. Claire Corp.'s sales increase from $500,000 to $1,000,000. What is the percentage change in…

A: Since you have asked multiple questions, we will solve the first question for you . If you want any…

Q: Your company opens and starts production this year and has variable costs per unit of $5,674 and…

A: Hence, under variable costing the amount of inventory reported is higher as compared to the amount…

Q: Victoria Company produces a single product. Last year’s income statement is as follows: Required:1.…

A: The break even sales are the sales point where no profit or loss is earned by business during the…

Q: Company XYZ is currently operating with a 65% contribution margin. The company is planning an…

A: Increase in contribution margin = Increase Sales x contribution margin ratio = $10000 x 65% = $6500

Q: Sinclair Company's single product has a selling price of $25 per unit. Last year the company…

A: The contribution Margin is calculated as difference between sales and variable cost. The break even…

Q: implemented and production decreased to 45,000 units? a- It will stay the same. b -It will increase…

A: The correct answer is :- b. It will increase

Q: a. Compute the CM ratio and breakeven points in dollars. b. Compute the operating leverage at last…

A: ANSWER: First let us metion the given values in question relating to product A of last year: Sales…

Q: Spice Inc.'s unit selling price is $49, unit variable costs are $39, fixed costs are $120,000, and…

A: Contribution margin: The difference between the sales and the variable costs is called the…

Q: The following information pertains to MacKenzie Corp. Sales of 22,500 units for $900,000, Fixed…

A: The objective of the question is to determine the new selling price, the new break-even point, the…

Q: The following information applies to the questions displayed below.] Data for Hermann…

A: The net operating income represents the income earned by the company due to the operations. It is…

Q: Last year Collins Company introduced a new product and sold 20,000 units of it at a price of $50 per…

A: 1. CM Ratio= It is Contribution margin ratio CM Ratio= Contribution/Sales Contribution =…

Q: For the past year, Pedi Company had fixed costs of $70,000, unit variable costs of $32, and a unit…

A: Fixed cost = $ 70,000 Selling price = $ 40 Variable cost = $ 32 Contribution per unit = Selling…

Q: If Canace Company, with a break-even point at $308,000 of sales, has actual sales of $440,000, what…

A: Break-even analysis is a technique widely used by the production department. It helps to determine…

Q: Accents Associates sells only one product, with a current selling price of $160 per unit. Variable…

A: Contribution per unit = Selling price per unit- variable cost per unit= $160- ($160*20%)= $128

Q: Company produces and sells X and Y. In 2020, 10,000 units of X were sold at P10 per unit with…

A: Contribution margin = Sales - Variable cost Profit/loss = Contribution margin - Fixed Cost Case 1…

Q: 20) Hsu, Inc. sells a single product for $12. Variable costs are $8 per unit and fixed čosts total…

A: Cost Accounting: It is the process of collecting, recording, analyzing the cost, summarizing cost,…

Q: Hart Company sold 5,000 units for a price of $50 per unit and had the following information:…

A: Introduction: The term "contribution margin" can be applied to any aspect of a business, including…

Q: Canoncito Co. produced and sold 6,000 units for $12 per unit. The variable cost was $3 per unit, and…

A: BREAK-EVEN POINT:-Break-even point can be calculated by dividing the total fixed cost of…

Q: . A ceramics manufacturer sold cups last year for P7.50 each. Variable costs of manufacturing were…

A: Solution The problem relates to breakeven analysis and the cost volume profit analysis…

Q: Phan Company has not reported a profit in five years. This year the company would like to narrow its…

A: Given that: Net Loss = $7500 Selling price per unit = $36.50 Variable costs per unit = $24 Fixed…

Q: Phan Company has not reported a profit in five years. This year the company would like to narrow its…

A: Required sales indicate the total sales value to achieve the target profit or narrow loss.

Q: First Class Corp. has sales of $200,000, a contribution margin of 20% and a margin of safety of…

A: The expression margin of safety is often used in break-even analysis to describe the sum of profits…

Q: Sphrantzes Company recently sold 175 units at a price of $650 per unit. During the same time the…

A: Net income is the amount of money that an entity earns after deducting the expenses from the…

Question

In 1992, Midas Company sold 52,000 units for $260,000 and made a loss of
$20,000. The variable cost per unit was $4.00. For 1993 you are informed that fixed
cost will be increased by $30,000 over 1992; that the selling price will increase by
20% per unit and variable costs will be $5.50 up to the 40,000 level, but will decrease
to $5.00 per unit above the 40,000 level.
a. What is the break-even point in sales for 1993?
b. Calculate the profit or loss if 130,000 of the units are sold in 1993.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1 Introduction

VIEW

Step 2 Calculation of Fixed cost for the Year 1992

VIEW

Step 3 Break-even point in sales for 1993

VIEW

Step 4 The profit or loss if 130,000 of the units are sold in 1993

VIEW

Step by step

Solved in 4 steps

SEE SOLUTION Check out a sample Q&A here

Similar questions

2. Annually (10000) units of a product are sold at a price of (12$) per unit, the amount of fixed costs is ($40000) and the annual profit is (30000$). The management of the producing company was presented with a new design that increases fixed costs by (10%) and variable costs by (20%), in return for increasing sales to reach (12,000) annual units. At what price must the product be sold in order for the profit to increase by a third? What is the volume of production at which the realized returns will be equal to the costs for the two cases?
Wiles Inc.'s unit selling price is $40, the unit variable costs is $30, fixed costs are $80,000, and current sales are 10,000 units. How much would operating income change if sales increase by 4,000 units? a. $100,000 increase b. $40,000 increase c. $80,000 decrease d. $60,000 decrease
Company XYZ last year sold 40,000 units of a product whose contribution margin is $20.00. This year the company expects to sell only 25,000, despite reducing the unit price by $5.00 and keeping all other costs constant. The expected decrease in operating profit is: a ) $275,000.00 b) $425,000.00 c) $325,000.00 d) $375,000.00
Morgan Technologies sells a single product at $30 per unit. The firm's most recent income statement revealed unit sales of 70,000, variable costs of $630,000, and fixed costs of $360,000. If a $6 drop in selling price will boost unit sales volume by 20%, the company will experience: Multiple Choice O O no change in profit because a 20% drop in sales price is balanced by a 20% increase in volume. an $47,000 drop in profit. a $210,000 drop in profit. a $360,000 drop in profit. None of the answers is correct.
Parker Company has not reported a profit in five years. This year the company would like to narrow its loss to $18,000. Assuming its selling price is $47.50 per unit and its variable costs per unit are $35, how many units must be sold to achieve its target given that total fixed costs are $64,000? (Do not round intermediate calculations.) Multiple Choice 3,973 3,387 5,120 3,680
Last year Minden Company introduced a new product and sold 25, 300 units of it at aprice of $99 per unit. The product's variable expenses are $69 per unit and its fixedexpenses are $837,300 per year. Required: 1. What was this product's net operatingincome (loss) last year? 2. What is the product's break - even point in unit sales anddollar sales? 3. Assume the company has conducted a marketing study that estimates itcan increase annual sales of this product by 5.000 units for each $2 reduction in itsselling price. If the company will only consider price reductions in increments of $2 (e.g$68, $66, etc.), what is the maximum annual profit that it can earn on this product?What sales volume and selling price per unit generate the maximum profit? 4. Whatwould be the break - even point in unit sales and in dollar sales using the selling pricethat you determined in requirement 3?
XYZ Company is facing changes in its cost structure so that fixed costs will decrease from $600,000 to $500,000, but variable costs will increase from $12 per unit to $14 per unit. If it were to implement these changes at its current production level of 50,000 units (with no change to selling price), profit would not change. What would happen to the company's profit if the changes were implemented, and production decreased to 45,000 units? O a. It will stay the same. O b. It will decrease. O c. none of the given answers O d. It will increase.
Your company’s single product has a selling price of $15 per unit. Last year the company variable costs were $9 per unit, fixed expenses were $90,000 and a net operating income was $30,000. A study by the sales manager disclosed that a 15% increase in the selling price would reduce unit sales by 10%. How many u it’s were sold last year?