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MIUPI companies produce lanyards (cord). The cost of making a unit of product is $ 1.00 for direct materials, $ 0.50 for indirect labor, $ 1.25 for variable indirect costs. Indirect fixed
100. Management is considering increasing the vendors total cost of salary by $ 2,000, there are 4 vendors and eliminating the commission. Determine the new breakeven point and select which is best for the company, commission to sellers
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- Product BW of Blair Designs generates sales revenue of $40,000. The product incurs variable costs of goods sold of $22,000, fixed selling costs of $22,000, and fixed factory overhead of $21,000. Determine if Product BW should be continued or discontinued. Assume that the company will incur the fixed factory overhead regardless of the decision. Support your conclusion with numbers. The fixed selling cost is avoidable.arrow_forwardSheffield Corp. sells 200000 units for $14 a unit. Fixed costs are $350000 and net income is $250000. What should be reported as variable expenses in the CVP income statement? $2200000. $2550000. $600000. $2450000.arrow_forwardJamison Company uses the total cost method of applying the cost-plus approach to product pricing. Jamison produces and sells Product X at a total cost of $800 per unit, of which $540 is product cost and $260 is selling and administrative expenses. In addition, the total cost of $800 is made up of $460 variable cost and $340 fixed cost. The desired profit is $168 per unit. Determine the markup percentage on total cost. %arrow_forward
- Perez Company incurs annual fixed costs of $120,540. Variable costs for Perez’s product are $27.90 per unit, and the sales price is $45.00 per unit. Perez desires to earn an annual profit of $63,000. RequiredUse the per unit contribution margin approach to determine the sales volume in units and dollars required to earn the desired profit. Do not round answer to the nearest whole numberarrow_forwardJackson, Ltd. produces a bicycle pump. The sales price per unit is $18.98. Fixed costs are $84 000. The variable cost per unit is $11.98. Find the profit on sales of 15000 units.arrow_forwardSunn Company manufactures a single product that sells for $120 per unit and whose variable costs are $90 per unit. The company's annual fixed costs are $432.000 Management targets an annual income of $750,000. (1) Compute the unit sales to earn the target income. Numerator: 1 Denominator: (2) Compute the dollar sales to earn the target income.. Numerator: Denominator P M = Units to Achieve Target Units to achieve target Dollars to Achieve Target Dollars to achieve targetarrow_forward
- Jordan Company incurs annual fixed costs of $51,415. Variable costs for Jordan's product are $3015 per unit, and the sales price is $45.00 per unit. Jordan desires to earn an annual profit of $56,000. Required Use the per unit contribution margin approach to determine the sales volume in units and dollars required to earn the desired profit. (Do not round intermediate calculations. Round your final answers to the nearest whole number.) Sales in dollars Sales volume in unitsarrow_forwardChung, Inc. sells 100,000 wrenches for $24 per unit. Fixed costs are $700,000 and net income is $500,000. What should be reported as variable expenses in the contribution margin income statement? $1,080,000 $1,200,000 $1,900,000 $1,700,000arrow_forwardBlossom Corporation has fixed costs of $404,700. It has a unit selling price of $7.00, unit variable cost of $5.45, and a target net income of $1,539,000.Compute the required sales in units to achieve its target net income. Required salesarrow_forward
- Penny Corporation desires to earn target net income of $15,000. If the selling price per unit is $51, unit variable cost is $31, and total fixed costs are $685,000, the number of units that the company must sell to earn its target net income isarrow_forwardMilden Company is a distributor who wants to start using a contribution format income statement for planning purposes. The company has analyzed its expenses and developed the following cost formulas: Cost Cost Formula Cost of good sold $31 per unit sold Advertising expense $187,000 per quarter Sales commissions 7% of sales Shipping expense? Administrative salaries $97,000 per quarter Insurance expense $10,700 per quarter Depreciation expense $67,000 per quarter Because shipping expense is a mixed cost, the company needs to estimate the variable shipping expense per unit sold and the fixed shipping expense per quarter using the following data: Shipping Expense Year 1: First 33,000 $177,000 Second 35,000 $ 192,000 Third 40,000 $234,000 Fourth 36,000 $ 197,000 Year 2: First 34,000 $ 187,000 Second 37,000 $ 202,000 Third 48,750 $ 240,000 Fourth 45,750 $ 216,000 Required: 1. Using the high- low method, estimate a cost formula for shipping expense in the form Y = a + bX. 2. In the first…arrow_forwardRitchie Manufacturing Company makes a product that it sells for $180 per unit. The company incurs variable manufacturing costs of $100 per unit. Variable selling expenses are $17 per unit, annual fixed manufacturing costs are $460,000, and fixed selling and administrative costs are $195,200 per year. Required Determine the break-even point in units and dollars using each of the following approaches: a. Use the equation method. b. Use the contribution margin per unit approach. c. Use the contribution margin ratio approach. d. Prepare a contribution margin income statement for the break-even sales volume. Complete this question by entering your answers in the tabs below. Req A to C Req D Determine the break-even point in units and dollars using the equation method, the contribution margin per unit approach and the contribution margin ratio approach. a. Break-even point in units a. Break-even point in dollars b. Contribution margin per unit b. Break-even point in units b. Break-even point…arrow_forward
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