POA11e23

# POA11e23 - CHAPTER 23Solutions COST BEHAVIOR ANALYSIS...

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Ch23 SE1 to SE3 COST BEHAVIOR ANALYSIS Chapter 23, SE 1. Hat maker A: Variable cost per derby \$ 4.50 Fixed cost per derby ( \$360 ÷ 15 ) 24.00 Hat maker B: Variable cost per derby \$ 4.50 Fixed cost per derby ( \$360 ÷ 12 ) 30.00 Chapter 23, SE 2. 1. b 2. c 3. b 4. a 5. a Chapter 23, SE 3. Activity Volume Month Level Cost High June 105 hours \$4,710 Low May 93 hours 4,230 Difference 12 hours \$ 480 Variable Cost per Telephone Hour = \$480 ÷ 12 Hours = \$40 per Hour Fixed costs for June = \$4,710 – ( \$40 × 105 ) = \$510 Fixed costs for May = \$4,230 – ( \$40 × 93 ) = \$510 CHAPTER 23 Solutions

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Ch23 SE4 Chapter 23, SE 4. Sales revenue \$64,000 ** less Variable costs 32,000 * Contribution margin 32,000 less Fixed costs 12,000 Operating income \$20,000 * \$8 × 4,000 = \$32,000 ** ? × 4,000 = \$64,000 Sales price = \$16
Ch23 SE5 to SE7 Chapter 23, SE 5. \$8.50 x = \$4.30 x + \$3,780 \$4.20 x = \$3,780 x = 900 Units Breakeven Dollars = \$8.50 × 900 Units = \$7,650 Chapter 23, SE 6. Breakeven Units = Fixed Costs ÷ Contribution Margin per Unit = \$5,500 ÷ ( \$11 \$6 ) = \$5,500 ÷ \$5 = 1,100 Units Chapter 23, SE 7. = Contribution Margin = \$10 = 0.625 Selling Price \$16 Breakeven Dollars = Fixed Costs = \$6,250 = \$10,000 Contribution Margin Ratio 0.625 * \$16 \$6 = \$10 Contribution Margin Ratio *

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Ch23 SE8 Chapter 23, SE 8. Selling Variable = Contribution × Sales = Weighted-Average Price Costs Margin (CM) Mix CM A \$10 \$4 = \$6 × 0.6667 = \$4.00 B \$ 8 \$5 = \$3 × 0.3333 = 1.00 Weighted-average contribution margin \$5.00 Weighted-Average Breakeven Point = \$15,000 ÷ \$5.00 = 3,000 Units Breakeven point for each product line: Weighted-Average Sales Breakeven Breakeven Point × Mix = Point A = 3,000 Units × 0.6667 = 2,000 Units B = 3,000 Units × 0.3333 = 1,000 Units Check: Contribution margin Product A = 2,000 × \$6 = \$12,000 Product B = 1,000 × \$3 = 3,000 Total contribution margin \$15,000 Less fixed costs 15,000 Profit (\$ 0) *Rounded. * *
Ch23 SE9 to SE10 Chapter 23, SE 9. Profit = Contribution Margin Fixed Costs = 300 ( \$48 \$18 ) \$4,000 = 300 ( \$30 ) \$4,000 = \$9,000 – \$4,000 = \$5,000 Chapter 23, SE 10. Activity Volume Month Level Cost Highest November 97 cases \$21,350 Lowest December 91 cases 20,840 Difference 6 cases \$ 510 Variable Cost per Case = \$510 ÷ 6 Cases = \$85 per Case Fixed Cost for November = \$21,350 ( 97 × \$85 ) = \$13,105 Fixed Cost for December = \$20,840 ( 91 × \$85 ) = \$13,105 Variable cost per case for December Direct labor \$190 Variable service overhead 85 Variable cost per case \$275 Fixed cost per case for December Fixed service overhead ( \$13,105 ÷ 91 ) \$144 *

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Ch23 E1 to E2 Chapter 23, E 1. 1. a 9. b (per car) and a (with size of fleet) 2. b 10. a 3. a 11. a 4. b 12. a 5. b 13. b 6. a 14. a 7. a 15. a 8. a 16. a Chapter 23, E 2. 1.
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POA11e23 - CHAPTER 23Solutions COST BEHAVIOR ANALYSIS...

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