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Cost Volume Profit Analysis 1. Clark Company produces flash drives for computers, which it sells for $20 each. Each flash drive costs $12 of variable...
Cost Volume Profit Analysis1. Clark Company produces flash drives for computers, which it sells for $20 each. Each flash drive costs $12 of variable costs to make. During April, 1,000 drives were sold. Fixed costs for March were $2 per unit for a total of $1,000 for the month. How much is the contribution margin ratio?30%40%60%70%If a company had a contribution margin of $500,000 and a contribution margin ratio of 40%, total variable costs must have been$750,000.00 $300,000.00 $1,250,000.00 $200,000.00 Disney’s variable costs are 30% of sales. The company is contemplating an advertising campaign that will cost $22,000. If sales are expected to increase $40,000, by how much will the company's net income increase?$18,000 $28,000 $12,000 $6,000 A division sold 200,000 calculators during 2008:$2,000,000Variable costs: $380,000150,000110,00060,000700,0001,000,000How much is the contribution margin per unit?$1.00 $3.50 $8.50 $6.50 Fixed costs are $300,000 and the variable costs are 75% of the unit selling price. What is the break-even point in dollars?c. $1,200,000d. $400,000Fixed costs are $1,500,000 and the contribution margin per unit is $150. What is the break-even point?$3,750,000 $10,000,000 3,750 units10,000 unitsReese Company requires sales of $2,000,000 to cover its fixed costs of $700,000 and to earn net income of $500,000. What percent are variable costs of sales?25%40%35%60%Forms, Inc. wants to sell a sufficient quantity of products to earn a profit of $40,000. If the unit sales price is $10, unit variable cost is $8, and total fixed costs are $80,000, how many units must be sold to earn income of $40,000?60,000 units40,000 units15,000 units600,000 unitsHow much sales are required to earn a target income of $80,000 if total fixed costs are $100,000 and the contribution margin ratio is 40%?$300,000 $200,000 $450,000 $330,000 Givenchy Company sells 100,000 wrenches for $12.00 per unit. Fixed costs are $350,000 and net income is $250,000. What should be reported as variable expenses in the CVP income statement?$540,000 $600,000 $950,000 $850,000 Dolce Company is planning to sell 400,000 hammers for $1.50 per unit. The contribution margin ratio is 20%. If Dolce will break even at this level of sales, what are the fixed costs?d.$480,000Moschino Company sells compact disk players for $60 each. Variable costs are $40 per unit, and fixed costs total $30,000. How many compact disk players must Moschino sell to earn net income of $70,000?5,0003,5002,5001,500Gaultier Company had actual sales of $800,000 when break-even sales were $600,000. What is the margin of safety ratio?25%33%67%75%Buerhrle’s CVP income statement included sales of 2,000 units, a selling price of $100, variable expenses of $60 per unit, and fixed expenses of $44,000. Contribution margin is:$200,000.00 $120,000.00 $80,000.00 $36,000.00 Vazquez Company’s cost of goods sold is $350,000 variable and $200,000 fixed. The company’s selling and administrative expenses are $250,000 variable and $300,000 fixed. If the company’s sales are $1,400,000, what is its contribution margin?$300,000 $800,000 $850,000 $900,000 Garland’s CVP income statement included sales of 3,000 units, a selling price of $100, variable expenses of $60 per unit, and net income of $50,000. Fixed expenses are$70,000.00 $120,000.00 $180,000.00 $300,000.00 For Galand Company, sales is $1,000,000, fixed expenses are $300,000, and the contribution margin ratio is 36%. What are the total variable expenses?d. $1,000,000 In 2008, Masset sold 3,000 units at $500 each. Variable expenses were $350 per unit, and fixed expenses were $200,000. The same selling price, variable expenses, and fixed expenses are expected for 2009. What is Masset’s break-even point in units for 2009?1,3333,0004,2856,667A company budgeted unit sales of 102,000 units for January, 2008 and 120,000 units for February, 2008. The company has a policy of having an inventory of units on hand at the end of each month equal to 30% of next month's budgeted unit sales. If there were 30,600 units of inventory on hand on December 31, 2007, how many units should be produced in January, 2008 in order for the company to meet its goals?107,400 units102,000 units96,600 units138,000 unitsAt January 1, 2008, Ceatric, Inc. has beginning inventory of 2,000 surfboards. Ceatric estimates it will sell 5,000 units during the first quarter of 2008 with a 12% increase in sales each quarter. Ceatric’s policy is to maintain an ending inventory equal to 25% of the next quarter’s sales. Each surfboard costs $100 and is sold for $150. How much is budgeted sales revenue for the third quarter of 2008?$225,000 $975,000 $940,800 $6,272 Garrison Company recorded operating data for its shoe division for the year. The company’s desired return is 5%.$500,000100,00060,000200,000Which one of the following reflects the controllable margin for the year?20%50%$30,000 $40,000
