10026_041910_96

# 10026_041910_96 - *Same income either way*Increase C.M per...

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*Handout – yellow sheet with homework problem answers. -Will review this homework on Wednesday. Sales – VC –FC = N.O.I. S – 7/20S – 58,500 = 0 .65S = 58,500 S = 58,500/ .65 S = \$90,000 *If you want N.O.I. to be \$19,500 then how many units to produce? 20u – 7u – 58,500 = 19,500 13u = 78,000 u = 78,000/ 13 u = 6000 units *If you want to earn \$19,500 AFTER taxes? N.O.I. (N.I. before taxes) x Tax (40%) -.4x N.I. (after tax) 19,500 X - .4x = 19,500 .6x = 19,500 X = 19,500/ .6 X= \$32,000 before tax 20u – 7u – 58,500 = 32,500 13u = 91,000 u = 91,000/ 13 u= 7000 units *5000 units and want \$15,000 in N.O.I 5000P – 5000(7) – 58,500 = 15,000 P = 108,500/ 5000 P = \$21.70 OLD NEW Selling Price 20 20 VC 7 5 FC 58,500 75,000 *Total Cost = Total cost Old Cost = New Cost VC + FC = VC + FC 7u + 58,500 = 5u + 75,000

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2u = 16,500 u = 8250 Indifference Point
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Unformatted text preview: *Same income either way! *Increase C.M. per unit = Increase Net Income *Income = Income Old N.O.I. = New N.O.I. 20u – 7u – 58,500 = 21u – 5u – 75,000 3u = 16,500 u = 5500 units More than 1 Product: A B S.P. 20 50 VC 7 24 FC 58,500 300,000 Common FC = 343,500 80% A to 20% B OR 4 A to 1 B S.P. = 4(20) + 1(50) = 130 VC = 4(7) + 1(24) = 52 C.M. = 78 Sales – VC – FC = N.O.I. 130P – 52P – 702,000 = 0 P = 702,000/ 78 P = 9000 packages A : 9000(4) = 36,000 B : 9000(1) = 9000 Total = 45,000 units S.P. = .8(20) + .2(50) = \$26 VC = .8(7) + .2(24) = \$10.40 Sales – VC –FC = N.O.I. 26u – 10.40u – 702,000 = 0 15.60u = 702,000 u = 702,000/ 15.60 u = 45,000 units A : 45,000(.8) = 36,000 B : 45,000(.2) = 9000...
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## This note was uploaded on 08/25/2010 for the course ACCT 327 taught by Professor Gillespie,j during the Spring '08 term at University of Delaware.

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10026_041910_96 - *Same income either way*Increase C.M per...

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