The Allen Company had the following income statement for...

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Your names: ___________________ Class time: _________ ACC350 – HW#8 (Chapter 17) Solutions Tuesday, April 3, 2012 Multiple Choice Questions 1. The Allen Company had the following income statement for the month of July 2006: Allen Company Income Statement For the Month of July 2006 Sales ($60 10,000) $600,000 Cost of goods sold: Direct materials ($12 10,000) $120,000 Direct labor ($9 10,000) 90,000 Variable factory overhead ($7.50 10,000) 75,000 Fixed factory overhead 120,000 405,000 Gross profit $195,000 Selling and administrative expenses: Variable ($1.50 10,000) $ 15,000 Fixed 90,000 105,000 Operating income $ 90,000 Allen Company's break-even sales volume is a. 20,000 units. b. 7,000 units. c. 11,211 units. d. 10,000 units. SUPPORTING CALCULATIONS: ($120,000 + $90,000)/($60 - $12 - $9 - $7.50 - $1.50) = 7,000 units
2. The contribution margin at the break-even point always
3. Which of the following items would NOT be considered in cost-volume-profit analysis?
4. In 2006, Angel's Bath and Body Shop had variable costs of $27,000, fixed costs of $18,000, and a net loss of $4,500. Angel's 2006 break-even sales volume was

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