24000 selling and administrative expenses 18000 of

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Manufacturing Expenses………………………………………………. $240.00 Selling and Administrative Expenses…………………………………. $180.00 Of the manufacturing expenses, 40% are fixed and 30% of the selling and administrative expenses are fixed. Compute the following, assuming that all inventories are negligible: 1. Total fixed manufacturing expenses…………………………………………$________ 2. Total variable manufacturing expenses………………………………………$_______ 3. Total fixed selling and administrative expenses……………………………..$_______ 4. Total variable selling and administrative expenses…………………………..$_______ 5. Total fixed expenses………………………………………………………….$_______ 6. Total variable expenses……………………………………………………….$_______ 7. Gross profit……………………………………………………………………$_______ 8. Contribution margin…………………………………………………………..$_______ 9. Net income…………………………………………………………………….$_______ Problem 5: Genuine Ore Co. produces and sells two products as follows: Q R Selling prices per unit………………………………... $25 $16 Variable costs per unit……………………………….. $20 $13 Total fixed costs are $40,500. Compute the breakeven point in terms of total units for each of these planned sales mixes: 1. Three Q’s for each R…………………………………………………. ________units 2. Three R’s for each Q…………………………………………………. ________units 3
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Problem 6: Hensley, a retailer, buys and sells turkeys. Hensley purchases the birds for $7 each and sells them for $15. Variable selling costs are 20% of Selling Price or Sales, and fixed costs are $4,000 annually. Answer the following: a) The gross profit per turkey is………………………………………………$_________ b) The contribution margin per turkey is……………………………………..$_________ c) Breakeven sales dollars are………………………………………………...$_________ d) Breakeven sales in units are…………………………………………… _________units e) If Hensley’s target profit is $22,000, the sales needed to achieve this target are: $____________ or _____________ turkeys. f) If Hensley desires a profit of $26,000 when she sells 12,000 turkeys, she must set her selling price per turkey at……………………………………………………... $_________ g) If Hensley sets her selling price at $12 per turkey and sells 12,000 turkeys will she be over or under her target profit of $26,000, and by how much? ………………………………………………………………._________by $___________ 4
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Problem 7: Ross Company, a retailer, purchases boots at $4.50 per pair and sells them at $10.00 per pair. Ross pays its salespeople a commission of 25% of the selling price. Fixed costs are $525 per month, and the company is subject to income tax at the rate of 20%.
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