Reference no: EM133101727

Questions -

Q1. Blackbird, Incorporated reports the following information regarding its production cost:

Units produced 39,000 units

Direct labor $ 13 per unit

Direct materials $ 17 per unit

Variable overhead $ 200 per unit

Fixed overhead $ 9,750,000 in total

a. Compute product cost per unit under variable costing.

b. Compute product cost per unit under absorption costing

Q2. Margin Company has total fixed costs of $360,000 and variable costs of $14 per unit. If the unit sales price is reduced from $24 to $20 and advertising is increased by $10,000, sales will increase from 40,000 to 65,000 units. Should Margin reduce its per unit sales price and pay for the additional advertising? (Support your answer with calculations.)

Q3. Expanse Company is considering the production and sale of a new product line with the following sales and cost data: unit sales price $125; unit variable costs $50; and total fixed costs of $150,000. Calculate the break-even point in units and in dollar sales.