Calculate the breakeven fee income, Cost Accounting

Assignment Help:

A company provides several different services to its customers from a single office. Fixed costs of the office, including staff costs, are absorbed into the company's service costs using  an  absorption  rate  of  $25  per  consulting  hour  based  on  a  budgeted  activity  level  of 100,000 hours each period.

Variable costs and fee income are different depending on services provided, however the average contribution to salesratio is 35%. Calculate breakeven fee income?

Solution:

Calculate the breakeven fee income.

Break-even revenue= Fixed overhead / C/S ratio

Therefore: $2,500,000 / 0.35 = $7,142,857


Related Discussions:- Calculate the breakeven fee income

Cost classification bases, Cost Classification Bases Costs can be clas...

Cost Classification Bases Costs can be classified on either more or one of the given bases as: a) Are the costs dependent on the level of output as like variable or are the

How many bottles do they need to sell to breakeven, Denair Fine Wines, Inc....

Denair Fine Wines, Inc., is planning to bring out a higher-quality wine product than any currently available in Stanislaus county. They've decided on selling the blended, fortified

Cost accountign, Hi, i need the solution manual for cost accounting manager...

Hi, i need the solution manual for cost accounting managerial emphasis 12 edition

Prepare a regular income tax return, Facts:   James (age 58, SS# 123-34-...

Facts:   James (age 58, SS# 123-34-4439) and Martha (age 56; SS# 233-23-9050) Williams are married. James works at a major retailer as manager of the early shift. Martha is a nu

Valuation of inventory or closing and issues stocks, Valuation of Inventory...

Valuation of Inventory or Closing and Issues Stocks Valuation of inventory aims on attaching a monetary value in the issued or stores for production. It is useful in producing

Sales budget, Sales Budget It provides volume of sales and sales mix o...

Sales Budget It provides volume of sales and sales mix of the recent operations. The sales forecast is initially prepared and upon completion the sales budget is finalized. Th

Prepare a cash budget, You have been asked to prepare a cash budget for Whi...

You have been asked to prepare a cash budget for Whitborrow plc for the next three months, October, November and December. The Managers are concerned that they may not have suffici

Product versus period costs, Product Versus Period Costs Another way to...

Product Versus Period Costs Another way to look at manufacturing costs is to think of them as attaching to a product. In other words, goods result from the manufacturing proces

MARGINAL COST APPLICATIONS, HOW APPLICABLE IS THE MARGINAL COSTING CONCEPT ...

HOW APPLICABLE IS THE MARGINAL COSTING CONCEPT IN ACCOUNTING

Explain the respective roles of the securities, Explain the respective role...

Explain the respective roles of the Securities and Exchange Commission (SEC) and the Internal Revenue Service (IRS) in the setting of accounting standards?

Write Your Message!

Captcha
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