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Denise Seals Problem 11-11

# Denise Seals Problem 11-11 - 11-11 CVP and Profit Volume...

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11-11 CVP and Profit – Volume Graphs LO4 Selling Price \$10 Unit variable cost \$6 Total fixed cost \$10,000 Revenue = \$10 X Units Unit Sold X-axis Total cost = (\$ 6 X Units) + \$10,000 Revenue 0 2500 5000 Total cost 0 2500 5000 Revenue =\$10 X Units Units Sold Total cost = (\$6 X Units) + \$15,000 Revenue 0 2,500 5,000 Total Cost 0 2,500 5,000 Revenue =\$10 X Units Units Sold Total cost = (\$7 X Units) + \$10,000 Revenue 0 2,500 5,000 Total Cost 0 2,500 5,000 Revenue =\$12 X Units Units Sold Total cost = (\$6 X Units) + \$10,000 Revenue 0 2,500 5,000 Total Cost 0 2,500 5,000 Revenue =\$10 X Units Units Sold Total cost = (\$7 X Units) + \$15,000 Revenue 0 1. Prepare a CVP graph with “Unit Sold” as the horizontal axis and “D 2. Prepare CVP graphs for each of the following independent scenarios a. Fixed cost increase by \$5,000. b. Unit variable cost increases to \$7. c. Unit selling price increases to \$12. d. Assume that fixed costs increase by \$5,000 and unit variable c

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2,500 5,000 Total Cost 0 2,500 5,000 Operating income = (\$10 X Units) - (\$6 X Units) - \$10,000 Units Sold Operating income = (\$4 X Units) - \$10,000 0 2500 Operating income = (\$10 X Units) - (\$6 X Units) - \$10,000 Operating income = (\$4 X Units) - \$15,000 Operating income = (\$10 X Units) - (\$7 X Units) - \$10,000
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