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Belton Company currently sells its products for $25 per unit. Management is contemplating a 20% increase in the sales price for next year.

4.Belton Company currently sells its products for $25 per unit. Management is contemplating a 20% increase in the sales price for next year. Variable costs are currently 30% of sales revenue and are not expected to change next year. Fixed expenses are $150,000. If fixed costs were to decrease 10% during the current year, contribution margin would do what?
A. Increase 10%
B. Impossible to determine with the given data
C. Decrease 10%
D. Remain the same
8. Fish farm grows salmon in coastal fish enclosures. When an enclosure is empties and the fish are processes, 4,000 pounds of fillets and 1,000 pounds of fish meal are produced at a cost of $12,000. Fillets sell for $3/pound, while fish meal sells for $1/pound. Fish Farm can process fillets further to produce lox. Lox sell for $10/pound. The smoking process costs $2 per pound of lox produces. Also, 3 pounds of fillets are requires to produce one pound of lox. Should Fish farm produce lox?
A. Yes.
B. No.
C. Cannot tell
9.Simpson company sells two products, A and B. Product A has a contribution margin of $2/unit. Product B has a contribution margin of $3/unit. The current sales mix is 50% product A and 50% product B. If the sales mix changes to 60% product A and 40% product B then the breakeven point, in number of units,
A. Increase
B. Decreases
C. Doesn’t change
D. Either increase, decrease or remain unchanged. It’s impossible to tell.

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