# Cost Problem 12-24 - Problem 12-24 Cost II Selling price...

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Problem 12-24 Cost II Selling price per unit \$40 Variable Expenses per unit (\$9.50+10+2.80+1.70) 24 Contribution Margin per unit \$16 Increased unit sales (80,000x25%) 20,000 Contribution margin per unit x \$16 Incremental contribution margin \$320,000 Less: added fixed selling expense -\$150,000 Incremental NOI \$170,000 Yes, the increase in fixes selling expense would therefore be justified. 2) The break-even price per unit Variable production cost per unit \$22.30 Import duties (\$14,000/20,000 units) \$0.70 Shipping cost per unit \$1.50 Break-even price per unit \$24.50 3) Determine impact on NOI Keep the Plant Open Close the Plant Sales (5,000units x \$40 per unit) \$200,000 \$0 Variable expenses (5,000 units x \$24 per unit) -\$120,000 \$0 Contribution margin \$80,000 \$0 Fixed expenses: Fixed manufacturing overhead cost: \$400,000 x 3/12 100,000 \$400,000 x 3/12 x 60% 60,000 Fixed selling expense: