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Exam 4: Cost-Volume-Profit Relationships

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Question 31

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Kantor,Inc. ,produces and sells a single product whose selling price is $180.00 per unit and whose variable expense is $46.80 per unit.The company's fixed expense is $580,752 per month. Required: Determine the monthly break-even in either unit or total dollar sales.Show your work!

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Unit sales to break even = Fi...

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Question 32

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The following is Addison Corporation's contribution format income statement for last month: The company has no beginning or ending inventories.A total of 20,000 units were produced and sold last month. -What is the company's contribution margin ratio?

A) 250%
B) 150%
C) 70%
D) 30%

E) None of the above
F) A) and C)

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Question 33

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Data concerning Plaxco Corporation's single product appear below: -Assume the company's monthly target profit is $11,000.The unit sales to attain that target profit is closest to:

Loss Corporation's contribution margin ratio is 63% and its fixed monthly expenses are $76,000.Assume that the company's sales for March are expected to be $179,000. Required: Estimate the company's net operating income for March,assuming that the fixed monthly expenses do not change.Show your work!

A manufacturer of tiling grout has supplied the following data: -The company's contribution margin ratio is closest to:

Hinsey Corporation produces and sells a single product.Data concerning the product appear below: Fixed expenses are $300,000 per month.The company is currently selling 4,000 units per month.Consider each of the following questions independently. -This question is to be considered independently of all other questions relating to Hinsey Corporation.Refer to the original data when answering this question. The marketing manager believes that an $18,000 increase in the monthly advertising budget would result in a 180 unit increase in monthly sales.What should be the overall effect of this change on the company's monthly net operating income?

If a company increases advertising by $500,000,this will cause net operating income to increase if the resulting increase in sales dollars is greater than:

Merced Corporation has provided the following budgeted data: -The break-even point in units is closest to:

Last year,Twins Company reported $750,000 in sales (25,000 units) and a net operating income of $25,000.At the break-even point,the company's total contribution margin equals $500,000.Based on this information,the company's:

McGordon Corporation has provided the following data: -The contribution margin is:

An increase in the number of units sold will decrease the break-even point.

Data concerning Sotero Corporation's single product appear below: The company is currently selling 5,000 units per month.Fixed expenses are $319,000 per month.Consider each of the following questions independently. -This question is to be considered independently of all other questions relating to Sotero Corporation.Refer to the original data when answering this question. The marketing manager would like to cut the selling price by $7 and increase the advertising budget by $20,000 per month.The marketing manager predicts that these two changes would increase monthly sales by 500 units.What should be the overall effect on the company's monthly net operating income of this change?

Zins Corporation produces and sells a single product.The company's contribution format income statement for August appears below: Required: Redo the company's contribution format income statement assuming that the company sells 1,400 units.

Data concerning Hahl Corporation's single product appear below: -The break-even in monthly dollar sales is closest to:

Data concerning Vogelgesang Corporation's single product appear below: The break-even in monthly dollar sales is closest to:

A product sells for $20 per unit,and has a contribution margin ratio of 40%.Fixed expenses are $120,000.How many units must be sold to yield a profit of $30,000?

The following is Addison Corporation's contribution format income statement for last month: The company has no beginning or ending inventories.A total of 20,000 units were produced and sold last month. -If sales increase by 100 units,by how much should net operating income increase?

Janet Company produces a game that sells for $17 per game.Variable expenses are $9 per game and fixed expenses total $172,000 annually. -The contribution margin ratio is closest to:

Data concerning Sotero Corporation's single product appear below: The company is currently selling 5,000 units per month.Fixed expenses are $319,000 per month.Consider each of the following questions independently. -This question is to be considered independently of all other questions relating to Sotero Corporation.Refer to the original data when answering this question. Management is considering using a new component that would increase the unit variable cost by $8.Since the new component would increase the features of the company's product,the marketing manager predicts that monthly sales would increase by 500 units.What should be the overall effect on the company's monthly net operating income of this change?

Weise Corporation produces and sells two products.Data concerning those products for the most recent month appear below: Fixed expenses for the entire company were $38,200. -If the sales mix were to shift toward Product U69I with total sales remaining constant,the overall break-even point for the entire company: