RAUCH -CHP 21-1 Homework Problems.xlsx - HORNGREN'S ACCOUNTING Eleventh Edition Chapter 21 Part 1 Homework Problems(20 points total You must complete

# RAUCH -CHP 21-1 Homework Problems.xlsx - HORNGREN'S...

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HORNGREN'S ACCOUNTING - Eleventh Edition Chapter 21: Cost-Volume-Profit Analysis Page 1 of 20 Chapter 21, Part 1, Homework Problems (20 points total) You must complete all fields highlighted in this green Answers in red have been provided for you by the instructor Name: Rose Rauch E21-25 (1 point) Match the terms with the correct definitions: Solution: 1. g Fixed costs 2. i Sensitivity analysis 3. a Breakeven point 4. d Margin of safety 5. f Sales mix 6. Net sales revenue minus variable costs b Contribution margin 7. c Cost behavior 8. h Variable costs 9. e Relevant range Costs that do not change in total over wide ranges of volume Technique that estimates profit or loss results when conditions change The sales level at which operating income is zero Drop in sales a company can absorb without incurring an operating loss Combination of products that make up total sales Describes how a cost changes as volume changes Costs that change in total in direct proportion to changes in volume The band of volume where total fixed costs and vairable cost per unit remain constant

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HORNGREN'S ACCOUNTING - Eleventh Edition Chapter 21: Cost-Volume-Profit Analysis Page 2 of 20
HORNGREN'S ACCOUNTING - Eleventh Edition Chapter 21: Cost-Volume-Profit Analysis Page 3 of 20 E21-27 (1 point) For each total fixed cost, determine the fixed cost per unit when sales are 45, 90, and 180 units Solution: Units sold: Total FC 45 Units 90 Units Store rent 1,800.00 40.00 20.00 Manager’s salary 1,350.00 30.00 15.00 Equipment lease 900.00 20.00 10.00 Depreciation on fixtures 675.00 15.00 7.50 Total fixed cost per unit: 105.00 52.50

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HORNGREN'S ACCOUNTING - Eleventh Edition Chapter 21: Cost-Volume-Profit Analysis Page 4 of 20 s. 180 Units 10.00 7.50 5.00 3.75 26.25
HORNGREN'S ACCOUNTING - Eleventh Edition Chapter 21: Cost-Volume-Profit Analysis Page 5 of 20 E21-28 (1 point) Solution: Units sold: VC/Unit 40 Units 80 Units 160 Units Direct materials 35 1,400 2,800 5,600 Direct labor 65 2,600 5,200 10,400 Variable overhead 9 360 720 1,440 Sales commission 11 440 880 1,760 Total variable cost : 4,800 9,600 19,200 For each variable cost per unit, determine the total variable cost when units produced and sold are 40, 80, and 160 units.

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