Given breakeven sales in units of 34000 and a unit

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8-99) Given breakeven sales in units of 34,000 and a unit contribution margin of $5, howmany units must be sold to reach a target operating income of $8,000?A) 32,400B) 40,000C) 35,600D) 1,600Answer:Explanation:C)Target Income $8,000 / $5 contribution margin =1,600Add Break even units + 34,000Total units35,600CDiff: 2
LO:7-2EOC:E7-19AAACSB:Analytical thinkingLearning Outcome:Perform fundamental CVP calculations.9-85) If the selling price per unit is $10, the unit contribution margin is $5, and total fixedexpenses are $15,000, what are the breakeven sales in units?D
BreakevenDiff: 2LO:7-2EOC:E7-19AAACSB:Analytical thinkingLearning Outcome:Perform fundamental CVP calculations.10-231) Total predicted sales (in units) minus total breakeven sales in units divided by totalpredicted sales (in units) yieldsDDiff: 2
LO:7-5EOC:E7-32AAACSB:Reflective thinkingChapter 81-217) Cruise Company produces a part that is used in the manufacture of one of itsproducts. The unitmanufacturing costs of this part, assuming a production level of 6,000 units, are as follows:Direct materials$4.00Direct labor$4.00Variable manufacturing overhead$3.00Fixed manufacturing overhead$1.00
Total cost$12.00The fixed overhead costs are unavoidable.Suri Company has offered to sell 6,000 units of the same part to Cruise Company for $14 perunit. Assuming the company has no other use for its facilities, what should Cruise Companydo?A
Diff: 2LO:8-6EOC:E8-25AAACSB:Analytical thinkingLearning Outcome:Use incremental analysis to make short-term decisions. Distinguish betweenrelevant and irrelevant costs.
2-41) Sky High Seats manufactures seats for airplanes. The company has the capacity toproduce 100,000 seats per year, but currently produces and sells 75,000 seats per year. Thefollowing information relates to the current production of the product:Sale price per unit$400Variable costs per unit:Manufacturing$220Marketing and administrative$50Total fixed costs:Manufacturing$750,000Marketing and administrative$200,000If a special sales order is accepted for 7,000 seats at a price of $350 per unit, and fixed costsremain unchanged, how would operating income be affected? (NOTE: Assume regular salesare not affected by the special order.)A) Increase by $560,000B) Decrease by $560,000C) Increase by $2,450,000D) Increase by $8,000,000Answer:Explanation:A)Variable Mfg. Cost$220Variable Marketing$50Total Variable$270NOWSales Price$350Less Total Variable Cost270= Contribution Margin$80Times units sold× 7,000= Additional Profit$560,000A
Diff: 2LO:8-2EOC:E8-19AAACSB:Analytical thinkingLearning Outcome:Use incremental analysis to make short-term decisions. Distinguish betweenrelevant and irrelevant costs.

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Term
Fall
Professor
WHEATLEY
Tags
Accounting, AACSB, Analytical Thinking

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