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# assignment - The operating income= 90,000 Income Tax= 40...

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Management Accounting Name: Vijay Dunnala Student Id: 1011032 Management Accounting Professor: James Tong Date: 26/04/2011 Week 2 Assignment 1

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Management Accounting 1) Based on the preceding data, calculate break-even sales in units. Sales for 100,00units = \$ 1,000,000 Sales per unit= 1,000,000/100,000 = \$10 Given that the variable expense = \$ 700,000 Variable expense per unit= 700,000/number of units = 700,000/100,000 = \$ 7 Given that the total fixed Expense= \$ 210,000 (Sales per unit)*x= (variable unit per expense)*x + fixed expense + profit 10x = 7x + 210,000 + 0 3X = 210,000 X=70,000. Week 2 Assignment 2
Management Accounting The break even sales in units = 70,000. 2) If Bidwell company is subject to an effective income tax rate of 40 percent, calculate the number of units Bidwell would have to sell to earn an after tax profit of \$90,000
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Unformatted text preview: The operating income= 90,000 Income Tax= 40 percent = 40/100 = 0.4 1 (Operating income) – 0.4 (operating income) = 1,000,000 0.6 (operating income)= 1,000,000 Operating income= 1,000,000/ 0.6 = 10,000,000/6 = 1666666.6 units The number of units that the Bidwell Company has to sell to earn a profit of \$90,000= = 1666666.6 units 3) If fixed costs increase \$ 31,500 with no other cost or revenue factors changing, calculate the break-even sales in units. Break even sales in units = (Fixed cost + Fixed cost increase) / (sales per unit – variable expense) = (210,000 + 31,500) / (10 - 7) = 241,500 / 3 = 80,500 units. The Break even sales = 80,500 units. Week 2 Assignment 3...
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assignment - The operating income= 90,000 Income Tax= 40...

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