Ptractice Chapter 4

Ptractice Chapter 4 - NOREEN MANAGERIAL ACCOUNTING FOR MANAGERS 2E Practice Exam Chapter 4 Print these pages Answer each of the following questions

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NOREEN MANAGERIAL ACCOUNTING FOR MANAGERS 2E Practice Exam – Chapter 4 Print these pages. Answer each of the following questions, explaining your answers or showing your work, as appropriate, and then compare your solutions to those provided at the end of the practice exam. 1.The following is Shaffer Corporation's contribution format income statement for last month: Sales $2,800,000 Less variable expenses 1,680,000 Contribution margin 1,120,000 Less fixed expenses 780,000 Net income $ 340,000 A total of 56,000 units were produced and sold last month. The company has no beginning or ending inventories. Part (a) What is the company’s breakeven in sales dollars? Part (b) How many units would the company have to sell to attain target profits of $550,000? Part (c) What is the company’s margin of safety? Part (d) What is the company's degree of operating leverage?
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2. Data for Hudson Corporation are shown below: Per Unit Percent of Sales Selling price . ............................... $80 100% Variable expenses . ..................... 52 65 Contribution margin . ................... $28 35% Fixed expenses are $30,000 per month and the company is selling 1,500 units per month. (a) The marketing manager believes a $6,000 increase in the monthly advertising budget would
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This note was uploaded on 01/13/2012 for the course IS 3020 taught by Professor Staff during the Spring '08 term at Kennesaw.

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Ptractice Chapter 4 - NOREEN MANAGERIAL ACCOUNTING FOR MANAGERS 2E Practice Exam Chapter 4 Print these pages Answer each of the following questions

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