Chapter 20, Problem 2PA

1.

To determine

Calculate the total fixed costs and the total variable costs for the current year.

2(a)

To determine

Calculate the unit variable cost for the current year.

2(b)

To determine

Calculate the unit contribution margin for the current year.

3.

To determine

Compute the break-even sales (units) for the current year.

4.

To determine

Compute the break-even sales (units) under the proposed program for the following year.

5.

To determine

Calculate the amount of sales (units) if the company desires a target profit of $60,000,000.

6.

To determine

Calculate the maximum operating income possible with the expanded plant.

7.

To determine

Calculate the operating income or loss for the following year, if the proposal is accepted and the sales remains same.

8.

To determine

Explain whether to recommend for accepting the proposal.