Managerial Accounting
17th Edition
ISBN: 9781260247787
Author: Ray H. Garrison, Eric W. Noreen, Peter C. Brewer
Publisher: RENT MCG
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Textbook Question
Chapter 5, Problem 13E
EXERCISE 5-13 Changes in Selling Price, Sales Volume, Variable Cost per Unit, and Total Fixed Costs LOS-1, LO5-4
Miller Company’s contribution format income statement for the most recent month is shown below:
Total Per Unit
Required:
(Consider each case independently):
- What is the revised net operating income if unit sales increase by 15%?
- What is the revised net operating income if the setting price decreases by $1.50 per unit and the number of units sold increases by 25%?
- What is the revised net operating income if the selling price increases by $1.50 per unit, fixed expenses increase by $20,000, and the number of units sold decreases by 5%?
- What is the revised net operating income if the setting price per unit increases by 12%, variable expenses increase by 60 cents per unit, and the number of units sold decreases by 10%?
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#10
The following monthly data are available for Tugg, Inc. which produces only one product: Selling price per unit, P42; Unit variable expenses, P14; Total fixed expenses, P70,000; Actual sales for the month of June, 4,000 units. How much is the margin of safety for the company for June?
Question 2
The following monthly data in contribution format are available for the Ross Company and its only product.
Product SD:
Sales
Variable expenses
Contribution margin
Fixed expenses
Net operating income
Total
$
$
$
$
$
381,600
304.800
76,800
34,500
42,300
Per Unit
$
5
159
127
32
The company produced and sold 2,400 units during the month and had no beginning or ending inventories.
a) What is the current operating leverage?
b) Projections indicate that the market will worsen by 15% next month. What is the projected net operating
income given this increase?
QUESTION 4
Exxarro Llimited is considering pricing and costing for the year ahead. The following data based on expected
production and sales of 15 000 units are provided for analysis:
Variable manufacturing cost
Fixed manufacturing cost
R1 185 000
R510 000
R5 per unit sold
R130 000
Sales commission
Fixed administration cost
Sales
R210 per unit
Study the information provided above and answer the following questions independently:
4.1 Calculate the break-even sales value.
4.2 Calculate the sales volume required to achieve a profit of R 800 000.
4.3 Suppose Exxaro Limited is considering a decrease of 10% per unit in the selling price of the product with the
expectation that it would increase sales volume by 10%. Is this a good idea? Motivate your answer with relevant
calculations.
Chapter 5 Solutions
Managerial Accounting
Ch. 5.A - EXERCISE 5A-1 High-Low Method LO5-10 The Cheyenne...Ch. 5.A - EXERCISE 5A-2 Least-Squares Regression LO5-11...Ch. 5.A - EXERCISE 5A-3 Cost Behavior; High-Low Method...Ch. 5.A - Prob. 4ECh. 5.A - EXERCISE 5A-5 Least-Squares Regression LO5-11...Ch. 5.A - Prob. 6PCh. 5.A - Problem 5A-7 Cost Behavior; High-Low Method;...Ch. 5.A - Problem 5A-8 High-Low Method; Predicting Cost...Ch. 5.A - Prob. 9PCh. 5.A - Prob. 10P
Ch. 5.A - Case 5A-11 Mixed Cost Analysis and the Relevant...Ch. 5.A - CASE 5A-12 Analysis of Mixed Costs in a Pricing...Ch. 5 - Prob. 1QCh. 5 - Often the most direct route to a business decision...Ch. 5 - Prob. 3QCh. 5 - What is the meaning of operating leverage?Ch. 5 - What is the meaning of break-even point?Ch. 5 - 5-6 In response to a request from your immediate...Ch. 5 - Prob. 7QCh. 5 - Prob. 8QCh. 5 - Prob. 9QCh. 5 - Prob. 1AECh. 5 - Prob. 2AECh. 5 - Prob. 3AECh. 5 - Prob. 4AECh. 5 - Prob. 5AECh. 5 - Prob. 1F15Ch. 5 - Prob. 2F15Ch. 5 - Prob. 3F15Ch. 5 - Prob. 4F15Ch. 5 - Prob. 5F15Ch. 5 - Prob. 6F15Ch. 5 - Prob. 7F15Ch. 5 - Prob. 8F15Ch. 5 - Prob. 9F15Ch. 5 - Prob. 10F15Ch. 5 - Prob. 11F15Ch. 5 - Prob. 12F15Ch. 5 - Prob. 13F15Ch. 5 - Prob. 14F15Ch. 5 - Prob. 15F15Ch. 5 - Prob. 1ECh. 5 - Prob. 2ECh. 5 - Prob. 3ECh. 5 - Prob. 4ECh. 5 - Prob. 5ECh. 5 - Prob. 6ECh. 5 - Prob. 7ECh. 5 - Prob. 8ECh. 5 - Prob. 9ECh. 5 - EXERCISE 5-10 Multiproduct Break-Even Analysis...Ch. 5 - Prob. 11ECh. 5 - EXERCISE 5-12 Multiproduct Break-Even Analysis...Ch. 5 - EXERCISE 5-13 Changes in Selling Price, Sales...Ch. 5 - Prob. 14ECh. 5 - Prob. 15ECh. 5 - Prob. 16ECh. 5 - Prob. 17ECh. 5 - Prob. 18ECh. 5 - Prob. 19PCh. 5 - PROBLEM 5-20 CVP Applications: Break-Even...Ch. 5 - PROBLEM 5-21 Sales Mix; Multiproduct Break-Even...Ch. 5 - Prob. 22PCh. 5 - Prob. 23PCh. 5 - Prob. 24PCh. 5 - Prob. 25PCh. 5 -
PROBLEM 5-26 CVP Applications; Break-Even...Ch. 5 - Prob. 27PCh. 5 - Prob. 28PCh. 5 - Prob. 29PCh. 5 - Prob. 30PCh. 5 -
PROBLEM 5-31 Interpretive Questions on the CVP...Ch. 5 - Prob. 32C
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