If the margin of safetyfor kramer company was 20 fixed

Reference no: EM13608562

1. Geitner Sports inc. manufactures and sells two products, baseball bats and baseball gloves. The fixed costs are $460,000 and the sales mix is 60% bats and 40% gloves. The units selling price and the unit variable cost for each product are as follows:

Products Unit Selling Price Unit variable Cost

Bats $100.00 $75.00

Gloves$80.00 $60.00

A. Compute the break-evensales (units) for the overall product

B. How many units of each product, baseball bats and baseball gloves, would be sold at the break even point?

2. Sunshine airways provides air transportation services between Philadelphia and Orlando. A single Philadelphi to Orlando round-trip flight has the following operating statistics:

Fuel $8,200

Flight Crew Salaries 3,700

Airplane Depreciation3,450

Variable Cost per passenger-business class 100

variable cost per passenger-economy lass 75

Round Trip ticket price-business class600

Round Trip Tickets price-economy class 190

It is assumed that the fuel, crew salaries, and airplane depreciation are fixed, regardless of the number of seats sold for the round-trip flight

A. Compute the break-even number of seats sold on a single roud-trip flight for the overall product. Assume that the overall product is 10% business and 90% economy class tickets.

B. How many business class and economy class seats would be sold at the break even point?

3. A. If steele company, with a break even point at $378,000 of sales, has actual sales of $540,000, what is the margin of safety expessed in dollars and in percentage of sales?

B.If the margin of safetyfor Kramer Company was 20%, fixed costs were $900,000, and variable costs were 70% of sales, what was the amount of actual sales (dollars)?

Reference no: EM13608562

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