Assume the following (1) sales = $200,000, (2) unit sales = 10,000, (3) the contribution margin ratio = 25%, and (4) net operating income = $10,000. Given these four assumptions, which of the following is true? The total fixed expenses = $90,000 The total variable expenses = $50,000 The contribution margin per unit = $5 The break-even point is 9,000 units

Use the following information to determine the break-even point in sales dollars:        Unit sales 50,000 Units Dollar sales $ 500,000 Fixed costs $ 204,000 Variable costs $ 187,500  

ssume a retailing company has two departments—Department A and Department B. The company’s most recent contribution format income statement follows:    Total   Department A   Department B Sales $ 800,000     $ 350,000       $ 450,000     Variable expenses   320,000       120,000         200,000     Contribution margin   480,000       230,000         250,000     Fixed expenses   400,000       140,000         260,000     Net operating income (loss) $ 80,000     $ 90,000       $ (10,000 )   The company says that $130,000 of the fixed expenses being charged to Department B are sunk costs or allocated costs that will continue if the segment is discontinued. However, if Department B is discontinued the sales in Department A will drop by 8%. What is the financial advantage (disadvantage) of discontinuing Department B? Hint: compare the lost contribution margin to the savings of fixed costs.

A product sells for $200 per unit, and its variable costs per unit are $130. Total fixed costs are $420,000. If the firm wants to earn $35,000 pretax income, how many units must be sold?

Data concerning Bedwell Enterprises Corporation’s single product appear below:   Selling price per unit $  200.00 Variable expenses per unit $  95.50 Fixed expense per month $  441,890     The unit sales to attain the company’s monthly target profit of $27,000 is closest to:

Assume a company has two products—A and B—that emerge from a joint process. Product A has been allocated $24,000 of the total joint costs of $48,000. A total of 2,000 units of Product A are produced from the joint process. Product A can be sold at the split-off point for $16 per unit, or it can be processed further for an additional total cost of $14,100 and then sold for $25 per unit. What is the financial advantage (disadvantage) of further processing Product A?

Assume the following (1) selling price per unit = $25, (2) variable expense per unit = $13, (3) the total fixed expenses = $20,000, and (4) net operating income = $10,000. Given these four assumptions, unit sales must be:

Under absorption costing, a company had the following unit costs when 10,000 units were produced: Direct labor $ 2 per unit Direct material $ 3 per unit Variable overhead $ 4 per unit Total variable $ 9 per unit Fixed overhead ($50,000/10,000 units) $ 5 per unit Total production cost $ 14 per unit  The total product cost per unit under absorption costing if 25,000 units had been produced would be $11.

Assume a company reported the following results:            Sales $ 400,000     Variable expenses   260,000     Contribution margin   140,000     Fixed expenses   40,000     Net operating income $ 100,000     Average operating assets $ 425,000       The return on investment (ROI) is closest to:

Assume a company provided the following information:   Patient-Days Maintenance Cost High activity level (September)   3,500   $ 10,400   Low activity level (May)   2,500   $ 9,200   Using the high-low method, what would be the estimated maintenance cost in a month with 2,780 patient-days?