What is the break-even monthly sales revenue

Assignment Help Accounting Basics
Reference no: EM132051425

Questions -

Question 1 - Joe's Tuxedos has monthly fixed costs of $12,000. The variable costs of sales are 60%. What is the break-even monthly sales revenue?

$20,000

$30,000

$19,200

$7,200

Question 2 - Delta Manufacturing has sales of $2,000,000 with direct materials cost of $400,000, direct labor of $280,000, variable overhead of $120,000, and fixed costs of $300,000. What is Delta's contribution margin percentage?

40%

55%

60%

45%

Question 3 - If a company has a 45% contribution margin ratio and has fixed costs of $250,000, how much sales does it need to earn a gross profit of $200,000?

$1,000,000

$555,556

$818,182

$652,500

Question 4 - Leisure Products management wants to ensure that each product makes a profit. The company produced a hammock that sold 3,500 units at $80 per unit. The variable cost of production was $36 per unit. The fixed costs were $110,000. What was the margin of safety?

$54,000

$80,000

$126,000

$20,000

Question 5 - Sports Specialty Inc. produces a bicycle that it normally sells wholesale for $250 per bike. The variable costs of production are $160 and the fixed cost for this product line is $154,000 per month. The company has been selling this product at a rate of 2,000 units per month. The company has received an order for 1,000 bikes at a price of $182 per bike. The order is to ship to a market where the company has no business, so it is believed it will not adversely affect existing business. The company has the capacity to produce the special order. How much will operating profit increase if Sports Specialty accepts this order?

increase of $26,000

increase of $48,000

decrease of $55,000

increase of $22,000

Question 6 - Premier Manufacturing makes and distributes a wall clock that is popular with schools and other institutions. Normal monthly sales are 2,500 clocks at an average sale price of $40 per clock. Production of each clock takes 15 minutes of direct labor and has material costs of $14. The direct labor rate is $22 per hour, and overhead is applied at a rate of $40 per direct labor hour. The overhead spending is 60% fixed and 40% variable costs. Premier has been approached by a supplier offering to supply all of the clocks at a finished cost of $25 per clock. Assume that all fixed overhead would remain, but the variable overhead would be eliminated. What would be the change in monthly operating income if Premier buys the clocks instead of making them?

increase of $3,750

decrease of $3,750

increase of $11,250

decrease of $11,250

Question 7 - Roscoe Enterprises has sales for a three-month period as follows: May, $240,000; June, $280,000; July, $275,000. All sales are on account, and history has shown that accounts receivable are typically collected 10% in the month of the sale, 60% in the month after the sale, and 30% two months after the sale. What are Roscoe's expected cash collections in the month of July?

$267,500

$172,000

$275,000

$280,000

Question 8 - Mega Manufacturing has a budget to sell 100,000 units of a certain product at a selling price of $35 per unit. Variable costs for materials, labor, and overhead are $18 per unit. Fixed cost is $800,000. Actual sales were 110,000 units, and management would like to see actual manufacturing performance compared to a budget adjusted for volume (flexible budget). What would be the adjusted budgeted operating profit?

$1,870,000

$900,000

$1,070,000

$990,000

Question 9 - A company president wants the chief financial officer to tell him how many sales are required to make a $1,000,000 operating profit. Variable production costs are 70% of sales, and fixed costs are $2,750,000. What are the required sales, rounded to the closest dollar?

$8,750,000

$5,357,143

$9,166,667

$12,500,000

Question 10 - Top Dog Company has a budget with sales of 5,000 units and $3,200,000. Variable costs are budgeted at $1,750,000, and fixed overhead is budgeted at $900,000. What is the budgeted manufacturing cost per unit?

$350

$530

$640

$460

Question 11 - X-Ray Manufacturing has the following revenues and costs:

Sales
Fixed overhead
Direct labor
Direct materials
Selling expenses
Administrative expenses
Variable overhead
Interest expense
Income tax

$4,340,000
$1,020,000
$458,000
$620,000
$365,000
$489,000
$224,000
$118,000
$366,000

Prepare a contribution margin income statement with both dollars and percentages of sales displayed.

Question 12 - Presented below are selected budget data items for Globe Corporation for a three-month period:


Sales
Direct materials
Direct labor
Variable overhead
Fixed overhead
Selling and admin. costs
Fixed loan payments

OCTOBER
$820,000
$123,000
$90,000
$65,600
$140,000
$312,000
$155,000

NOVEMBER
$780,000
$119,000
$85,000
$62,400
$140,000
$310,000
$155,000

DECEMBER
$850,000
$125,000
$96,000
$68,000
$140,000
$315,000
$155,000

Sales were $770,000 in August and $790,000 in September. Material usage was $115,000 in August and $118,000 in September. All sales are on account, and accounts receivable is historically collected 15% in the month of sale, 65% in the month following sales, and the remainder two months after the sale. Materials are paid for 40% in the month used and 60% the following month. All other expenses are paid in the month incurred. The cash balance was $35,000 at the beginning of October, and management wants to determine if the company will have enough cash to pay a year-end bonus.

Prepare a three-month cash budget, including a schedule for cash collections and material payments.

Question 13 - Olympic Products Inc. manufactures and distributes barbecue grills. The company normally sells 1,000 of these grills each month for a price of $140 each. The material cost for a grill is $44 and the direct labor is $22. The variable overhead cost is $13 per grill, and the fixed overhead cost is $30,000 per month. A contract manufacturer has approached the company and offered to supply the grills ready to sell for $85 each. The company management believes that if it accepts this offer, Olympic Products will be able to lease unused factory space for $10,000 per month.

Perform a make-versus-buy analysis.

Reference no: EM132051425

Questions Cloud

Calculate the breakeven number of units : Determine the formula used to calculate the breakeven number of units, then calculate the number of units that must be sold to break even.
Difference between the squares of two numbers : Four times the square of the first number increased by the square of the second number is 17. Find the numbers.
Find the length of the radius of the circle : If the point you found in (a) is the center of a circle, and the other two points are points on the circle, find the length of the radius of the circle.
Calculate the expected rate on a 5-year treasury bond : The Wall Street Journal reports that the current rate on 5-year Treasury bonds is 2.80 percent and on 10-year Treasury bonds is 5.25 percent.
What is the break-even monthly sales revenue : Joe's Tuxedos has monthly fixed costs of $12,000. The variable costs of sales are 60%. What is the break-even monthly sales revenue
Determine the after-tax cost of debt : The Walsh Company needs to compute its Weighted Average Cost of Capital (WACC) for the years ahead based on current market values.
How much do you need to save each month : You have no money in the investment yet and would like to start investing today. How much do you need to save each month?
Sample of the substance to decay : The half life of a certain substance is 19 years. How long will it take for a sample of the substance to decay to 66% of the original amount.
What are the cash payments associated with the sleeping : The debentures carried an interest rate of 7.55%, payable semiannually, and were priced at "par".

Reviews

Write a Review

Accounting Basics Questions & Answers

  Calculate the expected rate of return on joness stock

Internal common stock: Jones Industries has a beta of 1.39. Determine the expected rate of return on Jones's stock (cost of equity).

  Calculate controlling interest in consolidated net income

Pine Company, a computer manufacturer, owns 90% of the outstanding stock of Slider Company. Calculate controlling interest in consolidated net income for 2017

  Compute what is the total gross estate deductions

Dr. Heinz reversionary interest exceeded %5 of the value of the transferred property? What is the total gross estate? What is the total gross estate deductions

  You are the new marketing manager for a firm that produces

you are the new marketing manager for a firm that produces a line of athletic shoes to be targeted to the college

  Briefly indicate the practical and conceptual reasons

Briefly indicate the practical and conceptual reasons for the conclusion reached by the FinancialAccounting Standards Board on accounting and reporting practices for research and development costs

  Define and discuss definition of fraud and irregularities

Define and discuss the definition of fraud, irregularities, and corruption, versus "errors" in your own words

  What is amount of factory overhead controllable variance

The standard factory overhead rate is $10 per direct labor hour ($8 for variable factory overhead and $2 for fixed factory overhead) based on 100% capacity of 30,000 direct labor hours.

  Five-year bond that pays semiannual interest

On the first day of the fiscal year, a company issues a $1,200,000, 9%, five-year bond that pays semiannual interest of $54,000 ($1,200,000 × 9% × ½), receiving cash of $1,153,670. Journalize the bond issuance.

  Determine the fundamental differences in balance sheet

Determine the fundamental differences in balance sheet exposure from the application of each method.

  Jordan who is paid monthly is single and claims 0

jordan who is paid monthly is single and claims 0 deductions. he earns 100000 per year as a manager at a firm.

  Prepare production budgets for july august and september

Required: Prepare the following production budgets for July, August, and September for the Hale Company: Materials purchase budget

  Calculate the ending balance in accounts receivable

Accounts receivable balance on December 31, 2015 $918,000. Calculate the ending balance in Accounts Receivable, as at December 31, 2016

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd