Questions -
Q1. A company with a monthly fixed costs of $170,00 expects to earn monthly operating income of $25,000 by selling 6,500 units per month. What is the company's expected unit contribution margin?
A. $30 per unit
B. $ 26 per unit
C. 22 per unit
D. Not enough info to calculate
Q2. A company's most profitable products are often those which:
A. Have the highest contribution margin rations and the highest sales volumes
B. Have the highest contribution margin ratios and the lowest sales volumes
C. Have the lowest contribution margin ratios and the highest sales volumes
D. Have the lowest contribution margin ratios and the lowest sales volumes
Q3. Product X sells for $35 per unit and has related variable costs of $25 per unit. The fixed costs of producing product X are $65,000 per month. How many units of product X must be sold each month to earn a monthly operating income of $85,000?
A. 2833 units
B. 6000
C. 15000
D. 10,000
Q4. The Davidson co. Break even analysis in unit is 40,000. Assuming that costs are 60% and fixed costs are $300,000 what is the company's projected operating income is sales are $1,000,000?
A. $750,000
B. 100,000
C. 250,000
D. 400,000