Problem 18-1B Cost estimation using high-lowmethod P1Sun Co.'s monthly data for the past year follow. Management wants to usethese data to predict future variable and fixed costs.Month1195,000125,000105,000155,00095,000215,000145,000185,000135,00085,000175,000115,000Table Summary: A table2345370UnitsSold101112TotalCost$ 97,00087,00073,00089,00081,000110,00093,000105,00085,00058,00095,00079,000Required1. Estimate both the variable costs per unit and the total monthly fixedcosts using the high-low method.2. Use the answers for variable and fixed costs from part 1 to predictfuture total costs when sales volume is (a) 100,000 units and (b)170,000 units.Analysis Component3. Use these data to prepare a scatter diagram. Draw an estimated line ofcost behavior and determine whether the cost appears to be variable,fixed, or mixed.

Answered: Problem 18-1B Cost estimation using…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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PROBLEM SET B Problem 21-1B Cost estimation using high-low method P1 Sun Co.'s monthly data for the past year follow. Management wants to use these data to predict future variable and fixed costs. Units Sold 1.... 2.... 195.000 125,000 3.... 105,000 4.... 155,000 5.... 95,000 6.... 215,000 Month Total Cost $ 97,000 87,000 73,000 89,000 81,000 110,000 Month 7 ... 8... 9... 10 ... 11 ... 12 ... Units Sold 145,000 185,000 135,000 85,000 175,000 115,000 Total Cost $ 93,000 105,000 85,000 58,000 95,000 79,000 Required 1. Estimate both the variable costs per unit and the total monthly fixed costs using the high-low method. 2. Use the answers for variable and fixed costs from part 1 to predict future total costs when sales volume is (a) 100,000 units and (b) 170,000 units. Analysis Component page 799 3. Use these data to prepare a scatter diagram. Draw an estimated line of cost behavior and determine whether the cost appears to be variable, fixed, or mixed.
Question 3 Set 1
Exercise 18-9 (Algo) Contribution margin and break-even LO P2 Sunn Company manufactures a single product that sells for $190 per unit and whose variable costs are $133 per unit. The company's annual fixed costs are $735,300. (a) Compute the company's contribution margin per unit. Contribution margin (b) Compute the company's contribution margin ratio. 1 1 Numerator: (c) Compute the company's break-even point in units. 1 Numerator: Denominator: Numerator: Denominator: (d) Compute the company's break-even point in dollars of sales. 1 1 Denominator: = Contribution Margin Ratio Contribution margin ratio = = = = Break-Even Units Break-even units Break-Even Dollars Break-even dollars
2 and 3
> Question 26 Survivor Corporation produced 5,000 units for a total variable product cost of P 275,000 and a total fixed product cost of P 401,660.00 Determine the following: 1. Total variable product cost at 7,550 units. = 2. Fixed cost per unit at 7,550 units. = 4 pts
Question 3 The following monthly data in contribution format are available for the Timor Company and its only product. Product SD: Sales Variable expenses Contribution margin Fixed expenses Net operating income Total $ $ $ $ $ 227,500 162.500 65,000 45.000 20,000 Per Unit $ $ $ 91 65 26 The company produced and sold 2,500 units during the month and had no beginning or ending inventories. a) What is the current margin of safety? b) Management is concerned about having the funds to pay dividends next quarter. They believe net operating income of $35,000 will be sufficient. How much sales revenue is necessary to achieve this target profit?
Exercise 18-22 (Algo) CVP analysis with two products LO P3 Handy Home sells windows (80% of sales) and doors (20% of sales). The selling price of each window is $330 and of each door is $760. The variable cost of each window is $190 and of each door is $480. Fixed costs are $940,800. (1) Compute the weighted-average contribution margin (2) Compute the break-even point in units using the weighted-average contribution margin (3) Compute the number of units of each rpoduct that will be sold at the break-even point
Problem 21-2A Cost behavior estimation LO P1 Skip to question [The following information applies to the questions displayed below.] Alden Co.’s monthly unit sales and total cost data for its operating activities of the past year follow. Management wants to use these data to predict future fixed and variable costs. Month Units Sold Total Cost Month Units Sold Total Cost 1 315,500 $ 153,000 7 364,500 $ 311,084 2 160,500 96,750 8 265,500 147,250 3 260,500 201,100 9 76,900 69,500 4 200,500 95,500 10 145,500 126,125 5 285,500 197,000 11 89,500 89,500 6 185,500 107,500 12 95,500 86,150 Problem 21-2A Part 2 2. Predict future total costs when sales volume is (a) 371,000 units and (b) 411,000 units.
Unit VI question 6
QS 18-18 (Algo) Zhao Company has fixed costs of $342,200. Its single product sells for $173 per unit, and variable costs are $115 per unit. If the company expects sales of 10,000 units, compute its margin of safety (a) in dollars and (b) as a percent of expected sales. X Answer is complete but not entirely correct. a. Margin of safety (in dollar) $ 5,900 x b. Margin of safety (%) 41%
EXERCISE 6-12 Target Profit and Break-Even Analysis; Margin of Safety; CM Ratio [LO1, LO3, LO5, L06, LO7] Menlo Company distributes a single product. The company's sales and expenses for last month follow: Total Per Unit Sales... Variable expenses $450,000 $30 180,000 12 Contribution margin Fixed expenses. 270,000 216,000 $18 Net operating income $ 54,000 Required: 1. What is the monthly break-even point in units sold and in sales dollars? Without resorting to computations, what is the total contribution margin at the break-even point? 3. How many units would have to be sold each month to earn a target profit of $90,000? Use the formula method. Verify your answer by preparing a contribution format income statement at the target sales level. 2. 4. Refer to the original data. Compute the company's margin of safety in both dollar and percent- age terms. 5. What is the company's CM ratio? If sales increase by $50,000 per month and there is no change in fixed expenses, by how much would you…
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