1). James Company has a margin of safety percentage of 20% based on its actual sales. The break-even point is $170,000 and the variable expenses are 50% of sales. Given this information, the actual profit is: (Do not round intermediate calculations.)
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$17,000
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$17,000
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$21,250
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$18,750
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2) A company has provided the following data:
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Sales
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2,825
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units
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Sales price
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$ 77
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per unit
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Variable cost
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$57
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per unit
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Fixed cost
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$25,000
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If the sales volume decreases by 20%, the variable cost per unit increases by 10%, and all other factors remain the same, net operating income will: (Do not round intermediate calculations.)
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increase by $26,813.
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decrease by $7,318.
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decrease by $24,182.
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decrease by $18,500
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3) The following information relates to Clyde Corporation which produced and sold 41,000 units last month.
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Sales
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$779,000
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Manufacturing costs:
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Fixed
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$210,000
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Variable
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$140,400
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Selling and administrative:
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Fixed
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$300,000
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Variable
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$ 44,100
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There were no beginning or ending inventories. Production and sales next month are expected to be 31,000 units. The company's unit contribution margin next month should be: (Round your intermediate calculations and final answer to 2 decimal places)
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$18.55
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$3.90
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$9.58
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$14.50
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4) Dimitrov Corporation, a company that produces and sells a single product, has provided its contribution format income statement for July.
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Sales (7,700 units)
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$400,400
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Variable expenses
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246,400
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Contribution margin
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154,000
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Fixed expenses
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103,500
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Net operating income
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$ 50,500
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If the company sells 7,600 units, its net operating income should be closest to:
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$50,500
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$46,000
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$48,500
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$49,979
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5) The contribution margin ratio is 20% for Grain Company and the break-even point in sales is $244,000. To obtain a target net operating income of $82,000, sales would have to be: (Do not round intermediate calculations.)
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$326,000
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$325,600
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$259,600
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$654,000
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6) Rothe Company manufactures and sells a single product that it sells for $100 per unit and has a contribution margin ratio of 45%. The company's fixed expenses are $47,400. If Rothe desires a monthly target net operating income equal to 25% of sales, the amount of sales in units will have to be: (Round your intermediate calculations to 2 decimal places and final answer to the nearest whole number.)
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1,256 units
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3,237 units
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810 units
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2,370 units
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7) Darth Company sells three products. Sales and contribution margin ratios for the three products follow:
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Product X
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Product Y
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Product Z
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Sales in dollars
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$24,000
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$44,000
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$104,000
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Contribution margin ratio
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49%
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44%
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19%
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Given these data, the contribution margin ratio for the company as a whole would be: (Round your intermediate calculations to 2 decimal places. Round your answer to whole percentage.)
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30%
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47%
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37%
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it is impossible to determine from the data given.
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8) Pool Company's variable expenses are 29% of sales. Pool is contemplating an advertising campaign that will cost $19,300. If sales increase by $79,300, the company's net operating income should increase by: (Do not round intermediate calculations.)
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$37,003
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$22,997
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$9,843
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$70,006
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9) Data concerning Runnells Corporation's single product appear below:
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Per Unit
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Percent of Sales
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Selling price
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$160
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100%
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Variable expenses
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80
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50%
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Contribution margin
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$ 80
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50%
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The company is currently selling 5,800 units per month. Fixed expenses are $407,600 per month. The marketing manager believes that a $6,800 increase in the monthly advertising budget would result in a 110 unit increase in monthly sales. What should be the overall effect on the company's monthly net operating income of this change would be closest to a(an):
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Decrease of $6,800
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Decrease of $2,000
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Increase of $2,000
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Increase of $8,800
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10 ) Hirt Corporation sells its product for $9 per unit. Next year, fixed expenses are expected to be $500,000 and variable expenses are expected to be $5 per unit. How many units must the company sell to generate net operating income of $90,000?
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100,000 units
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183,556 units
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118,000 units
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147,500 units
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11) At a sales level of $82,000, Blue Company's contribution margin is $32,000. If the degree of operating leverage is 5 at a $82,000 sales level, net operating income must equal:
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$6,400
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$25,600
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$16,400
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$10,000
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12) The following data pertain to Epsom Corporation's operations:
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Unit sales
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12,300 units
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Selling price
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$30 per unit
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Contribution margin ratio
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30%
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Margin of safety percentage
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20%
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The variable expense per unit is: (Do not round intermediate calculations.)
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$9.00 per unit
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$6.00 per unit
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$21.00 per unit
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$15.00 per unit
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13) Bumpass Corporation's contribution margin ratio is 79% and its fixed monthly expenses are $ 48,000. Assume that the company's sales for July are expected to be $ 107,000.
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Required:
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Estimate the company's net operating income for July, assuming that the fixed monthly expenses do not change. (Omit the "$" sign in your response.)
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14) Olds Inc., which produces a single product, has provided the following data for its most recent month of operations:
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Number of units produced
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10,400
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Variable costs per unit:
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Direct materials
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$110
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Direct labor
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$99
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Variable manufacturing overhead
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$7
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Variable selling and administrative expenses
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$11
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Fixed costs:
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Fixed manufacturing overhead
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$343,200
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Fixed selling and administrative expenses
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$717,600
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There were no beginning or ending inventories. The absorption costing unit product cost was:
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$209
$249
$216
$329
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15)A manufacturing company that produces a single product has provided the following data concerning its most recent month of operations:
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Selling price
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$157
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Units in beginning inventory
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200
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Units produced
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7,900
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Units sold
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7,500
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Units in ending inventory
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600
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Variable cost per unit:
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Direct materials
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$47
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Direct labor
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$45
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Variable manufacturing overhead
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$7
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Variable selling and administrative
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$5
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Fixed costs:
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Fixed manufacturing overhead
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$260,700
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Fixed selling and administrative expenses
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$120,000
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What is the total period cost for the month under variable costing?
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$260,700
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$157,500
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$380,700
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$418,200
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