A company needs to sell 15,000 units of its only product in order to break even. Fixed costs are $180,000, and the per unit selling price and variable costs are $24 and $11, respectively. If total sales are $270,000, the company’s margin of safety will be equal to:
Q: A product sells for $200 per unit, and its variable costs per unit are $130. The fixed costs are…
A: Break-even point: It can be defined as that level of production at which the total costs incurred by…
Q: XYZ company currently sells 15,000 units a month for $50 each, has variable costs of $20 per unit,…
A: Contribution margin is the price of the product deduct all the linked variable costs, results from…
Q: A company sells 4100 units of a product at 15 JOD per unit, which costs the company JOD 12 to…
A: Markup: The markup is the difference between the selling price of a product or service and the cost…
Q: Macy's sells a product for $20, and has variable costs per unit of $12. Fixed costs are $12,000. How…
A: Break-even point is the point where the company earns normal profit that is no profit and no loss.
Q: Micol & Co. Ltd sells a single product, baby hamper, with a selling price of $150 and variable costs…
A: Margin of safety means the difference between the budget sales and breakeven sales. It means the…
Q: One company sells a product at $ 40 and its variable costs are $ 30 per unit, while the company's…
A: Margin of safety refers to the amount of how much the output or sales level can fall before a…
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: Farrow Co. expects to sell 300,000 units of its product in the next period with the following…
A: Incremental Analysis: Incremental analysis refers to the analysis of differential revenue that could…
Q: If the company has a target profit of $15,000, how many units must be sold
A: Breakeven point: Breakeven point is the point at which the company makes no profit nor loss or it is…
Q: Barometers sell for $300 each. Variable costs are $200 per unit, fixed production costs are $2,000,…
A: Profit is the excess of revenue over cost. Profit can be found out by deducting cost price from…
Q: Sweet Manufacturing is planning to sell 400,000 hammers for $3 per unit. The contribution margin…
A: Contribution margin per unit = Sales x Contribution margin ratio = $3 per unit x 20% = $0.60 per…
Q: A bike manufacturing company has fixed costs of $165,000 per annum and the variable costs are 48% of…
A: Calculate contribution margin per unit, if variable costs increased to 56% of sales.Contribution…
Q: A bike manufacturing company has fixed costs of $120,000 per annum and the variable costs are 37% of…
A: Contribution margin = ( 1 - Variable cost ) Break-even point = FIxed cost / Contribution margin…
Q: If Canace Company, with a break-even point at $522,600 of sales, has actual sales of $670,000, what…
A: Solution:-a Calculation of margin of safety in dollars and as a percentage of sales as follows…
Q: John's Company owns three production lines A, B, and C, and each production line achieves a…
A: Break Even Point Under Multiplicity of Product means the total quantity of units sold of each…
Q: The manufacturer of a product that has a variable cost of $2.50 per unit and total fixed cost of…
A: The break-even point (BEP) appears to be an accounting term that refers to the point where a…
Q: Barnam Company currently produces and sells 6,000 units of a product that has a contribution margin…
A: Determine contribution margin per unit (After investment).
Q: XYZ company currently sells 15,000 units a month for $50 each, has variable costs of $20 per unit,…
A: Contribution margin is the price of the product deduct all the linked variable costs, results from…
Q: The market price for a product has been $50 per unit, but competitive pressures have reduced…
A: Manufacturing costs: Manufacturing costs are the costs which are involved in converting the raw…
Q: how many units must Tony sell to breakeven?
A: Breakeven sales is the sales at which there is no profit or no loss. Breakeven point = Fixed cost/…
Q: Annually (10000) units of a product are sold at a price of (12) $/unit, if the fixed costs is…
A: The question is based on the concept of Cost Accounting.
Q: Glassman Company sells its one product at $30 per unit. Variable costs are $25 per unit and fixed…
A: Break-even point in units = Fixed costs / (Selling price - Variable costs) Break-even point in sales…
Q: Farrow Co. expects to sell 300,000 units of its product in the next period with the following…
A: Incremental income is the monetary gain or loss that results from a specific administrative…
Q: Perry, Inc. manufactures metal stampings for automobiles: stick shifts and trim kits. Fixed costs…
A: Contribution margin per unit = Sales per unit - Variable cost per unit Break-even point in…
Q: Knoll, Inc. currently sells 51,000 units a month for $98 each, has variable costs of $68 per unit,…
A: Calculate the amount of prior profit before the price change.
Q: If the fixed cost becomes $1,250,000, due to the increase in rent and salaries, what would be the…
A: The following computations are done for Jet X Company to calculate the revised BEP load factor.
Q: A company that manufactures ceramic cups has a fixed costs amounting to P270,000 per month Variable…
A: The following information is provided as follows:- Fixed cost per month = P270,000 Variable cost =…
Q: If Canace Company, with a break-even point at $960,000 of sales, has actual sales of $1,200,000,…
A: Break even point shows the sales in units or amount at which the company will be in a position of no…
Q: Piper Corp. is operating at 70% of capacity and is currently purchasing a part used in its…
A: Answer is Option c) $30,000 cost increase .
Q: Luna Sea Sushi, Inc. has total costs of $130,000 when it sells 40,000 units. If total fixed costs…
A: Variable cost per unit can be calculated by dividing total variable cost by total units.
Q: Newman Company currently produces and sells 7,000 units of a product that has a contribution margin…
A: Target Profit: It refers to the desired amount of profit that a company expects to achieve by the…
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: Dull Corporation produces 8,000 parts each year, which are used in the production of one of its…
A: Give, Purchase price = $28 Fixed cost if purchased from outside = $20 - ($20*1/4) Fixed cost if…
Q: One company sells a product at $ 40 and its variable costs are $ 30 per unit, while the company's…
A: Introduction: Margin of safety = Actual sales value - Break even sales value Deduction of break even…
Q: Shapland Inc. has fixed operating costs of $500,000 and variable costs of $50per unit. If it sells…
A: Given information: Fixed operating costs amounted to $500,000 Variable cost per unit is $50 Selling…
Q: Farrow Co. expects to sell 300,000 units of its product in the next period with the following…
A: Working Notes: Additional volume: 1. sales = 30000 units * $12 per unit =$360000 2. Direct…
Q: Chile's, Inc. currently produces and sells 4,000 units of a product that has a contribution margin…
A: Break even point means a point where firm is neither earning profit nor incurring any loss. For…
Q: a. If Del Rosario Company, with a break-even point at $1,160,000 of sales, has actual sales of…
A: a. 1. Margin of safety = Total actual sales - Break even sales = $1450000 - $1160000 = $290000 2.…
Q: The Charleston Company has fixed costs of Birr 20,000 per month, and variable costs of Birr 15 per…
A: Profit = Sales - Variable Cost - Fixed Cost
Q: Micol & Co. Ltd sells a single product, baby hamper, with a selling price of $150 and variable costs…
A: Breakeven units is the units where at those units there is no loss or no profit. Breakeven in units…
Q: The variable cost to get the product to customers is $3 per unit, and the price the company charges…
A: Break Even Point is the point where the total costs are recovered at a certain time. Break even is…
Q: Tony Company is contemplating of marketing a new product. Fixed costs will be P800,000 for…
A: Breakeven point is described as the point of level of production where the total expenses equal the…
Q: The Blue Co. will produce 25,000 units of product next year. Variable costs ratio is 70%, while…
A: The expected sales needs to be calculated in order to recover the fixed cost and earn a profit of…
Q: The following are data from a production, calculate; a. The Break-even point in terms of sales value…
A: During the manufacturing and sale of goods and services, the determination of the break-even point…
Q: Zhao Co. has fixed costs of $354,000. Its single product sells for $175 per unit, and variable costs…
A: Given: The values are, fixed costs of $354,000. Its single product sells for $175 per unit, and…
Q: Chile's, Inc. currently produces and sells 4,000 units of a product that has a contribution margin…
A: Contribution margin per unit at Target Profit :-…
Q: Phelps Industries is a multi-product company that currently manufactures 30,000 units of part ST35…
A: Differential analysis helps manager to evaluate costs and revenue that can arise from taking up…
A company needs to sell 15,000 units of its only product in order to break even. Fixed costs are $180,000, and the per unit selling price and variable costs are $24 and $11, respectively. If total sales are $270,000, the company’s margin of safety will be equal to:
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- Faldo Company produces a single product. The projected income statement for the coming year, based on sales of 200,000 units, is as follows: Required: 1. Compute the unit contribution margin and the units that must be sold to break even. Suppose that 30,000 units are sold above the break-even point. What is the profit? 2. Compute the contribution margin ratio and the break-even point in dollars. Suppose that revenues are 200,000 greater than expected. What would the total profit be? 3. Compute the margin of safety in sales revenue. 4. Compute the operating leverage. Compute the new profit level if sales are 20 percent higher than expected. 5. How many units must be sold to earn a profit equal to 10 percent of sales? 6. Assume the income tax rate is 40 percent. How many units must be sold to earn an after-tax profit of 180,000?Schylar Pharmaceuticals, Inc., plans to sell 130,000 units of antibiotic at an average price of 22 each in the coming year. Total variable costs equal 1,086,800. Total fixed costs equal 8,000,000. (Round all ratios to four significant digits, and round all dollar amounts to the nearest dollar.) Required: 1. What is the contribution margin per unit? What is the contribution margin ratio? 2. Calculate the sales revenue needed to break even. 3. Calculate the sales revenue needed to achieve a target profit of 245,000. 4. What if the average price per unit increased to 23.50? Recalculate: a. Contribution margin per unit b. Contribution margin ratio (rounded to four decimal places) c. Sales revenue needed to break even d. Sales revenue needed to achieve a target profit of 245,000Delta Co. sells a product for $150 per unit. The variable cost per unit is $90 and fixed costs are $15,250. Delta Co.s tax rate is 36% and the company wants to earn $44,000 after taxes. What would be Deltas desired pre-tax income? What would be break-even point in units to reach the income goal of $44,000 after taxes? What would be break-even point in sales dollars to reach the income goal of $44000 after taxes? Create a contribution margin income statement to show that the break-even point calculated in B, generates the desired after-tax income.
- A company needs to sell 10,000 units of its only product in order to break even. Fixed costs are $110,000, and the per unit selling price and variable costs are $20 and $9, respectively. If total sales are $220,000, the company’s margin of safety will be equal to: a. $0 b. $20,000 c. $110,000 d. $200,000Bradley Company sells a product that has variable costs of $54 each and a sales price $79 each. Bradley has fixed costs of $110,000 and a desired profit of $35,000. If the Company is able to reduce its variable cost per unit to $39 while holding all other items constant, the number of units that must be sold to earn the desired profit willThe manufacturer of a product that has a variable cost of $2.50 per unit and total fixed cost of $117,000 wants to determine the level of output necessary to avoid losses. What level of sales is necessary to break-even if the product is sold for $4.35? Round your answer to the nearest whole number. units What will be the manufacturer’s profit or loss on the sales of 104,000 units? Round your answer to the nearest dollar. $ If fixed costs rise to $164,000, what is the new level of sales necessary to break-even? Round your answer to the nearest whole number. units If variable costs decline to $2.25 per unit, what is the new level of sales necessary to break-even? Round your answer to the nearest whole number. units If fixed costs were to increase to $164,000, while variable costs declined to $2.25 per unit, what is the new break-even level of sales? Round your answer to the nearest whole number. units If a major proportion of fixed costs were noncash (depreciation), would…
- Help me pleaseJasmine Incorporated sells a product for $61 per unit. Variable costs per unit are $31, and monthly fixed costs are $252,000. Answer the following questions: Required: a. What is the breakeven point in units? b. What unit sales would be required to earn a target profit of $162,000 ? c. Assuming Jasmine achieves the level of sales required in part b, what is the margin of safety in sales dollars?A company faces fixed costs of $100,000 and variable costs of $8.00/unit. They plan to directly sell their product to the market for $12.00. How many units must they produce and sell to break even?
- Management believes it can sell a new product for $9.00. The fixed costs of production are estimated to be $7,000, and the variable costs are $3.40 a unit. Complete the following table at the given levels of output and the relationships between quantity and fixed costs, quantity and variable costs, and quantity and total costs. Round your answers to the nearest dollar. Enter zero if necessary. Use a minus sign to enter losses, if any. Quantity Total Revenue Variable Costs Fixed Costs Total Costs Profits (Losses) 0 $ $ $ $ $ 500 $ $ $ $ $ 1,000 $ $ $ $ $ 1,500 $ $ $ $ $ 2,000 $ $ $ $ $ 2,500 $ $ $ $ $ 3,000 $ $ $ $ $ Determine the break-even level using the above table and use the Exhibit 19.5 to confirm the break-even level of output. Round your answers for the break-even level to the nearest whole number. Round your answers for the fixed costs, variable costs, total costs,…Management believes it can sell a new product for $7.50. The fixed costs of production are estimated to be $4,500, and the variable costs are $3.90 a unit. a. Complete the following table at the given levels of output and the relationships between quantity and fixed costs, quantity and variable costs, and quantity and total costs. Round your answers to the nearest dollar Enter zero if necessary. Use a minus sign to enter losses, if any Quantity Variable Costs Fixed Costs 0 500 1,000 $ $ $ S 2,500 $ 3,000 S 1,500 2,000 Total Revenue S Quantity $ $ Total Revenue $ $ $ $ $ $ $ $ $ S Fixed Costs $ $ Total Costs b. Determine the break-even level using the above table and use the Exhibit 19.5 to confirm the break even level of output. Round your answers for the break-even level to the nearest whole number. Round your answers for the fixed costs, variable costs, total costs, and profits (losses) to the nearest dollar. Enter zero if necessary Use a minus sign to enter losses, if any Variable…Fountain Corp. has a selling price of $14 per unit and variable costs of $9.80 per unit. When 18,000 units are sold, profits equaled $24,900. What is the margin of safety?