Question Description
Given the following cost and activity observations for Smithson Company's utilities, use the high-low method to calculate Smithson's fixed costs per month. Round your final answer to the nearest dollar. Do not round interim calculations.
|
Cost |
Machine Hours |
|
|
January |
$26,700 |
10,100 |
|
February |
37,100 |
18,300 |
|
March |
28,600 |
12,500 |
|
April |
30,700 |
15,300 |
$23,613
$11,112
$44,448
$13,890
If sales are $816,000, variable costs are 68% of sales, and operating income is $210,000, what is the contribution margin ratio?
32%
64%
68%
36%
Bluegill Company sells 14,900 units at $280 per unit. Fixed costs are $208,600 and income from operations is $2,711,800. Determine the following: Round the contribution margin ratio to two decimal places.
|
a. Variable cost per unit |
$ |
|
|
b. Unit contribution margin |
$ |
per unit |
|
c. Contribution margin ratio |
% |
Break-Even Point
Elrod Inc. sells a product for $75 per unit. The variable cost is $45 per unit, while fixed costs are $48,000.
Determine (a) the break-even point in sales units and (b) the break-even point if the selling price were increased to $95 per unit.
|
a. Break-even point in sales units |
units |
|
b. Break-even point if the selling price were increased to $95 per unit |
units |
Target Profit
Versa Inc. sells a product for $100 per unit. The variable cost is $75 per unit, and fixed costs are $45,000.
Determine (a) the break-even point in sales units and (b) the break-even point in sales units if the company desires a target profit of $25,000.
|
a. Break-even point in sales units |
units |
|
b. Break-even point in sales units if the company desires a target profit of $25,000 |
units |
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