1. Calculate the unit cost for variable costing.
2. Calculate the unit cost for absorption costing.
3. Prepare an absorption-costing income statement.
4. Prepare a variable-costing income statement.
5. Reconcile the differences in income
6. Calculate the breakeven point in units. Reference page 279.
7. Calculate the breakeven point in sales dollars.
8. Calculate the safety margin.
9. What does the margin of safety mean?
10. Calculate the operating leverage
11. What if sales volume increases by 5% how much will income increase in percentage terms? Make sure you have read over the DOL discussion and understand the multiplier impact of changes in sales volume that occurs based on DOL.
12. What if the direct material cost per unit increases from $8 a unit to $10, what will be the new breakeven in units? Explain why it changed.
You should only have to change the direct labor in the data area and actually all your answers should be updated. Please put the direct material cost back to the original number once you have answered the question?
13. What if the manufacturing overhead cost decreases from 120,000 to 115,000, what will be the new breakeven in units? Explain why it changed.
You should only have to change the fixed MOH in the data area and actually all your answers should be updated. Please put the fixed MOH cost back to the original number once you have answered the question?
Attachment:- Fallproject.xls