BA102B_2006_Spring_M - University of California Berkeley Walter A Haas School of Business UGBA102B Introduction to Managerial Accounting MidTerm I

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University of California, Berkeley Walter A. Haas School of Business UGBA102B Introduction to Managerial Accounting MidTerm I Exam; Spring 2006 Student Name: ____________________ ; Student ID ____________________ Space is provided for answers on these sheets. Please show computations. Question 1. (25 points) Butler Sales Company is a distributor that has an exclusive franchise to sell a particular product made by another company. Butler Sales Company’s income statements for the last two years are given below: Assume that fixed expenses for both years is constant with respect to number of units sold. Required: 1. Estimate the company’s total variable expenses per unit and its total fixed expenses per year. 2. Compute the company’s contribution margin for this year. This Year Last Year Units sold 200,000 160,000 Sales revenue 1,000,000 $ 800,000 $ Less cost of goods sold 700,000 $ 560,000 $ Gross margin 300,000 $ 240,000 $ Less operating expenses 210,000 $ 198,000 $ Net operating income 90,000 $ 42,000 $
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(Space for Question 1) UGBA 102B Introduction to Managerial Accounting / Geyer / Spring 2006 2
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Question 2. (25 points) Zoran Corporation manufactures and sells a single product; cordless telephones. Zoran is considering upgrading its current manufacturing facilities with more modern equipment. Relevant cost data under the current facility and the upgraded facility is provided below: Under either system, Zoran will sell the cordless phones for $125 per phone. Required: 1. What is the breakeven point (in number of phones) of each option? 2. At what level of sales (in number of phones) will it start being more profitable for Zoran to have the upgraded facilities? UGBA 102B Introduction to Managerial Accounting
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This note was uploaded on 12/16/2009 for the course UGBA 08564 taught by Professor Geyer during the Spring '09 term at University of California, Berkeley.

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BA102B_2006_Spring_M - University of California Berkeley Walter A Haas School of Business UGBA102B Introduction to Managerial Accounting MidTerm I

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