Cost Behavior and Cost-Volume-Profit Analysis Part 4

166. Harold Corporation just started business in January 2012. They had no beginning inventories. During 2012 they manufactured 12,000 units of product, and sold 10,000 units. The selling price of each unit was $20. Variable manufacturing costs were $4 per unit, and variable selling and administrative costs were $2 per unit. Fixed manufacturing costs were $24,000 and fixed selling and administrative costs were $6,000. What would be the Harold Corporations Net income for 2012 using variable costing? A. $114,000 B. $110,000 C. $4,000 D. $106,000 167. Harold Corporation just started business in January 2012. They had no beginning inventories. During 2012 they manufactured 12,000 units of product, and sold 10,000 units. The selling price of each unit was $20. Variable manufacturing costs were $4 per unit, and variable selling and administrative costs were $2 per unit. Fixed manufacturing costs were $24,000 and fixed selling and administrative costs were $6,000. What would be the difference in Harold Corporation’s Net income for 2012 if they used variable costing instead of absorption costing? A. No difference B. $2,000 greater C. $4,000 less D. $6,000 less 168. Given the following cost data, what type of cost is shown? Total Cost $500 $1,000 $1,500 $2,000 # of units 1 2 3 4 A. mixed cost B. variable cost C. fixed cost D. none of the above 169. Given the following cost data, what type of cost is shown? Cost per unit $5,000 $2,500 $1,667 $1,250 # of units 1 2 3 4 A. mixed cost B. variable cost C. fixed cost D. none of the above 170. Given the following cost data, what type of cost is shown? Total Cost $3,500 $4,000 $4,500 $5,000 # of units 1 2 3 4 A. mixed cost B. variable cost C. fixed cost D. none of the above 171. The manufacturing cost of Mocha Industries for three months of the year are provided below: April May June Total Cost $ 63,100 80,920 100,900 Production 1,100 Units 1,800 2,600 Using the high-low method, determine the (a) variable cost per unit, and (b) the total fixed costs. 172. The manufacturing cost of Carrie Industries for the first three months of the year are provided below: January February March Total Cost $ 93,300 115,500 79,500 Production 2,300 Units 3,100 1,900 Using the high-low method, determine the (a) variable cost per unit, and (b) the total fixed cost. 173. Carmelita Company sells 40,000 units at $18 per unit. Fixed costs are $62,000 and income from operations is $258,000. Determine the (a) variable cost per unit, (b) unit contribution margin, and (c) contribution margin ratio . 174. Penny Company sells 25,000 units at $59 per unit. Variable costs are $29 per unit, and loss from operations is ($50,000). Determine the (a) unit contribution margin (b) contribution margin ratio, and (c) fixed costs per unit at production of 25,000 units. 175. Gladstorm Enterprises sells a product for $60 per unit. The variable cost is $20 per unit, while fixed costs are $85,000. Determine the (a) break-even point in sales units, and (b) break-even point in sales units if the selling price increased to $80 per unit. Round your answer to the nearest whole number. 176. Mia Enterprises sells a product for $90 per unit. The variable cost is $40 per unit, while fixed costs are $75,000. Determine the (a) break-even point in sales units, and (b) break-even point in sales units if the selling price increased to $100 per unit. 177. The Atlantic Company sells a product with a break-even point of 3,000 sales units. The variable cost is $60 per unit, and fixed costs are $270,000. Determine the (a) unit sales price, and (b) break-even points in sales units if the company desires a target profit of $36,000. 178. The Waterfall Company sells a product for $150 per unit. The variable cost is $80 per unit, and fixed costs are $270,000. Determine the (a) break-even point in sales units, and (b) break-even points in sales units if the company desires a target profit of $36,000. Round your answer to the nearest whole number. 179. Bobby Company has fixed costs of $160,000. The unit selling price, variable cost per unit, and contribution margin per unit for the company’s two products are provided below. Product Selling Price per unit Variable Cost per unit X Y $180 $100 $100 $60 Contribution Margin per unit $80 $40 The sales mix for product X and Y is 60% and 40% respectively. Determine the break-even point in units of X and Y. 180. Steven Company has fixed costs of $160,000. The unit selling price, variable cost per unit, and contribution margin per unit for the company’s two products are provided below. Product Selling Price per unit Variable Cost per unit X Y $180 $100 $80 $50 Contribution Margin per unit $100 $50 The sales mix for product X and Y is 60% and 40% respectively. Determine the break-even point in units of X and Y. 181. The Keith Company reports the following data. Sales Variable costs Fixed costs Determine Keith Company’s operating leverage. $900,000 $500,000 $350,000 182. The Tom Company reports the following data. Sales Variable costs Fixed costs $600,000 $400,000 $100,000 Determine Tom Company’s operating leverage. 183. The Dean Company has sales of $500,000, and the break-even point in sales dollars of $300,000. Determine the company’s margin of safety percentage. 184. The Grant Company has sales of $300,000, and the break-even point in sales dollars if $225,000. Determine the company’s margin of safety percentage. 185. Blane Company has the following data: Total Sales Total Variable Costs Fixed Costs Units sold $800,000 $300,000 $200,000 50,000 units What will operating income be if units sold double to 100,000 units? 186. Douglas Company has a contribution margin ratio of 30%. If Douglas has $336,420 in fixed costs, what amount of sales will need to be generated in order for the company to break even? 187. Racer Industries has fixed costs of $900,000. Selling price per unit is $250 and variable cost per unit is $130. Required: a. How many units must Racer sell in order to break even? b. How many units must Racer sell in order to earn a profit of $480,000? c. A new employee suggests that Racer Industries sponsor a company 10-K as a form of advertising. The cost to sponsor the event is $7,200. How many more units must be sold to cover this cost? 188. Global Publishers has collected the following data for recent months: Month Issues published March 20,500 $20,960 April 21,800 22,464 May 17,750 18,495 June 21,200 21,395 Total cost Required: a. Using the high-low method, find variable cost per unit, total fixed costs, and the total cost equation. b. What is the estimated cost for a month in which 19,000 issues are published? 189. Trail Bikes, Inc. sells three Deluxe bikes for every seven Standard bikes. The Deluxe bike sells for $1,800 and has variable costs of $1,200. The Standard bike sells for $600 and has variable costs of $200. Required: A. If Trail Bikes has fixed costs that total $1,702,000, how many bikes must be sold in order for the company to break even? B. How many of these bikes will be Deluxe bikes and how many will be the Standard bikes? 190. If a business had a capacity of $10,000,000 of sales, actual sales of $6,000,000, break-even sales of $4,200,000, fixed costs of $1,800,000, and variable costs of 60% of sales, what is the margin of safety expressed as a percentage of sales? 191. Safari Co. sells two products, Orks and Zins. Last year Safari sold 21,000 units of Orks and 14,000 units of Zins. Related data are: Product Orks Zins Unit Selling Price $120 80 Unit Variable Cost $80 60 Unit Contribution Margin $40 20 Calculate the following: a. Safari Co.’s sales mix b. Safari Co.’s weighted average unit selling price c. Safari Co’s weighted average unit contribution margin d. Safari Co’s break-even point assuming that last year’s fixed costs were $160,000. 192. Given the following information: Variable cost per unit = $5.00 July fixed cost per unit = $7.00 Units sold and produced in July 25,000 What is total estimated cost for August if 30,000 units are projected to be produced and sold? 193. Carrolton, Inc. currently sells widgets for $80 per unit. The variable cost is $30 per unit and total fixed costs equal $240,000 per year. Sales are currently 20,000 units annually. The company is considering a 20% drop in selling price that they believe will raise units sold by 20%. Assuming all costs stay the same, what is the impact on income if they make this change? 194. Given the following: Variable cost as a percentage of sales = 60% Unit Variable cost = $30 Fixed costs = $200,000 What is the break-even point in units? 195. A business had a margin of safety ratio of 20%, variable costs of 75% of sales, fixed costs of $240,000, a break-even point of $960,000, and operating income of $60,000 for the current year. Calculate the current year's sales.