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SE_Ch04 - SAMPLE EXAM CHAPTER 4*SEE SOLUTION ON THE LAST...

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SAMPLE EXAM: CHAPTER 4 ***SEE SOLUTION ON THE LAST PAGE*** 1. Escareno Corporation has provided its contribution format income statement for June. The company produces and sells a single product. Sales (8,400 units) ......................... $764,400 Variable expenses .......................... 445,200 Contribution margin ........................ 319,200 Fixed expenses .............................. 250,900 Net operating income ..................... $ 68,300 If the company sells 8,200 units, its total contribution margin should be closest to: a. $301,000 b. $311,600 c. $319,200 d. $ 66,674 2. Conrad’s Ornamental Concrete manufactures ornamental concrete blocks. Each unit requires variable production costs of $20.00 per unit and variable selling costs are $5.00 per unit. Fixed overhead is expected to be $150,000 and fixed administrative expenses are expected to be $50,000. Each unit will sell for $50. Compute the sales in dollars necessary to earn income of $100,000 (before tax). 3. Dice Company has a budget that reports the following: Revenue ($20/unit) $200,000 Variable Costs 150,000 Contribution Margin $ 50,000 Fixed Costs 30,000 Expected Profit $ 20,000 At what level of sales (in dollars) does Dice Company expect to breakeven?
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