FUND.ACCT.PRIN -ONLINE ONLY  >I<
FUND.ACCT.PRIN -ONLINE ONLY >I<
22nd Edition
ISBN: 9780077632878
Author: Wild
Publisher: MCG
Question
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Chapter 21, Problem 21SP
To determine

Introduction:

Break Even Sales is very useful for determining the level at which organization is able to recover all its fixed expenses. Sometime when sales comprises of combination of products – then we have to calculate the Selling price of the standard Mix and calculate Break Even sales for the Selling price / contribution of the standard Mix.

To Calculate:

We are required to calculate the selling price of composite Unit.

Expert Solution
Check Mark

Answer to Problem 21SP

Solution

The Selling price of Composite units is $ 4750

Explanation of Solution

Explanation:

The calculations are given here:

  Business Solutions
Answer S. No. Details Desk Chair Value Composite unit
    $ No. $ No. $
  Selling Price 1250   500    
             
  Selling Qty   3   2 5
             
1 Sales Price Per composite unit         4750
             
  Variable Cost Per Unit 750   250    
             
  Units   3   2 5
             
2 Variable Cost Per Composite Unit         2750
             
  Contribution per Composite Unit         2000
             
  Fixed Expenses         120000
             
3 No of Composite Units to break even         60
             
4.1 Sales of Desk 60*3 180      
             
4.2 Sales of Chair 60*2     120  
Conclusion

Conclusion: Selling price of Composite unit is $ 4750

To determine

Introduction:

Break Even Sales is very useful for determining the level at which organization is able to recover all its fixed expenses. Sometime when sales comprises of combination of products – then we have to calculate the Selling price of the standard Mix and calculate Break Even sales for the Selling price / contribution of the standard Mix.

To Calculate:

We are required to calculate the Variable Cost of composite Unit.

Expert Solution
Check Mark

Answer to Problem 21SP

Solution

The Variable Cost of Composite units is $ 2750

Explanation of Solution

Explanation:

The calculations are given here:

  Business Solutions
Answer S. No. Details Desk Chair Value Composite unit
    $ No. $ No. $
  Selling Price 1250   500    
             
  Selling Qty   3   2 5
             
1 Sales Price Per composite unit         4750
             
  Variable Cost Per Unit 750   250    
             
  Units   3   2 5
             
2 Variable Cost Per Composite Unit         2750
             
  Contribution per Composite Unit         2000
             
  Fixed Expenses         120000
             
3 No of Composite Units to break even         60
             
4.1 Sales of Desk 60*3 180      
             
4.2 Sales of Chair 60*2     120  
Conclusion

Conclusion: Variable Cost of Composite unit is $ 2750.

To determine

Introduction:

Break Even Sales is very useful for determining the level at which organization is able to recover all its fixed expenses. Sometime when sales comprises of combination of products – then we have to calculate the Selling price of the standard Mix and calculate Break Even sales for the Selling price / contribution of the standard Mix.

To Calculate:

We are required to calculate the Break Even Point in composite Unit.

Expert Solution
Check Mark

Answer to Problem 21SP

Solution

The Break even point in Composite unit is 60 Units.

Explanation of Solution

Explanation:

The calculations are given here:

  Business Solutions
Answer S. No. Details Desk Chair Value Composite unit
    $ No. $ No. $
  Selling Price 1250   500    
             
  Selling Qty   3   2 5
             
1 Sales Price Per composite unit         4750
             
  Variable Cost Per Unit 750   250    
             
  Units   3   2 5
             
2 Variable Cost Per Composite Unit         2750
             
  Contribution per Composite Unit         2000
             
  Fixed Expenses         120000
             
3 No of Composite Units to break even         60
             
4.1 Sales of Desk 60*3 180      
             
4.2 Sales of Chair 60*2     120  
Conclusion

Conclusion: Break Even Point in composite units is 60 Units.

To determine

Introduction:

Break Even Sales is very useful for determining the level at which organization is able to recover all its fixed expenses. Sometime when sales comprises of combination of products – then we have to calculate the Selling price of the standard Mix and calculate Break Even sales for the Selling price / contribution of the standard Mix.

To Calculate:

We are required to calculate the Number of units sold for each product to achieve break Even.

Expert Solution
Check Mark

Answer to Problem 21SP

Solution

We are required to sell 180 units of Desk and 120 units of Chair to achieve Break Even.

Explanation of Solution

Explanation:

The calculations are given here:

  Business Solutions
Answer S. No. Details Desk Chair Value Composite unit
    $ No. $ No. $
  Selling Price 1250   500    
             
  Selling Qty   3   2 5
             
1 Sales Price Per composite unit         4750
             
  Variable Cost Per Unit 750   250    
             
  Units   3   2 5
             
2 Variable Cost Per Composite Unit         2750
             
  Contribution per Composite Unit         2000
             
  Fixed Expenses         120000
             
3 No of Composite Units to break even         60
             
4.1 Sales of Desk 60*3 180      
             
4.2 Sales of Chair 60*2     120  
Conclusion

Conclusion: We need to sell 180 Units of Modular Desk and 120 units of Office Chairs to achieve break even.

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Chapter 21 Solutions

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Ch. 21 - How does assuming that operating activity occurs...Ch. 21 - Prob. 12DQCh. 21 - Prob. 13DQCh. 21 - Prob. 14DQCh. 21 - Prob. 15DQCh. 21 - Prob. 16DQCh. 21 - Prob. 17DQCh. 21 - Prob. 18DQCh. 21 - Prob. 19DQCh. 21 - Prob. 20DQCh. 21 - Prob. 21DQCh. 21 - Prob. 1QSCh. 21 - Prob. 2QSCh. 21 - Prob. 3QSCh. 21 - Prob. 4QSCh. 21 - Prob. 5QSCh. 21 - Prob. 6QSCh. 21 - Prob. 7QSCh. 21 - Prob. 8QSCh. 21 - Prob. 9QSCh. 21 - Prob. 10QSCh. 21 - Prob. 11QSCh. 21 - Prob. 12QSCh. 21 - Prob. 13QSCh. 21 - Prob. 14QSCh. 21 - Prob. 15QSCh. 21 - Prob. 16QSCh. 21 - Prob. 17QSCh. 21 - Prob. 1ECh. 21 - Prob. 2ECh. 21 - Prob. 3ECh. 21 - Exercise 21-4 Measurement of cost behavior using a...Ch. 21 - Prob. 5ECh. 21 - Prob. 6ECh. 21 - Prob. 7ECh. 21 - Prob. 8ECh. 21 - Prob. 9ECh. 21 - Prob. 10ECh. 21 - Prob. 11ECh. 21 - Prob. 12ECh. 21 - Prob. 13ECh. 21 - Prob. 14ECh. 21 - Prob. 15ECh. 21 - Prob. 16ECh. 21 - Prob. 17ECh. 21 - Prob. 18ECh. 21 - Prob. 19ECh. 21 - Prob. 20ECh. 21 - Prob. 21ECh. 21 - Prob. 22ECh. 21 - Prob. 23ECh. 21 - Prob. 24ECh. 21 - Prob. 25ECh. 21 - Prob. 1APSACh. 21 - Prob. 2APSACh. 21 - Prob. 3APSACh. 21 - Prob. 4APSACh. 21 - Prob. 5APSACh. 21 - Prob. 6APSACh. 21 - Prob. 7APSACh. 21 - Prob. 1BPSBCh. 21 - Prob. 2BPSBCh. 21 - Prob. 3BPSBCh. 21 - Prob. 4BPSBCh. 21 - Prob. 5BPSBCh. 21 - Prob. 6BPSBCh. 21 - Prob. 7BPSBCh. 21 - Prob. 21SPCh. 21 - Prob. 1BTNCh. 21 - Prob. 2BTNCh. 21 - Prob. 3BTNCh. 21 - Prob. 4BTNCh. 21 - Prob. 5BTNCh. 21 - Prob. 6BTNCh. 21 - Prob. 7BTNCh. 21 - Prob. 8BTNCh. 21 - Prob. 9BTN
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