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Exam 5: Cost-Volume-Profit Relationships

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Question 121

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Zanetti Corporation produces and sells a single product. Data concerning that product appear below: The break-even in monthly unit sales is closest to: (Round your intermediate calculations to 2 decimal places.)

A) 3,873 units
B) 1,740 units
C) 1,201 units
D) 2,271 units

E) A) and B)
F) A) and C)

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Question 122

Multiple Choice

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Nocum Corporation has provided the following contribution format income statement. Assume that the following information is within the relevant range. If salesvolumes decline to 2,900 units, the net operating income would be closest to:

A) $29,000
B) $1,000
C) $8,700
D) $8,000

E) All of the above
F) A) and B)

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Question 123

Multiple Choice

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A company that makes organic fertilizer has supplied the following data: The company's margin of safety in units is closest to: (Round per unit calculations to 2 decimal places.)

The contribution margin ratio of Kuck Corporation's only product is 75%. The company's monthly fixed expense is $585,000 and the company's monthly target profit is $11,250.Required:Determine the dollar sales to attain the company's target profit.

Callander Corporation is a wholesaler that sells a single product. Management has provided the following cost data for two levels of monthly sales volume. The company sells the product for $140.50 per unit. The best estimate of the total monthly fixed cost is: (Round your intermediate calculations to 2 decimal places.)

Yamakawa Corporation produces and sells a single product. Data concerning that product appear below: Required: Determine the monthly break-even in unit sales.

Dietrick Corporation produces and sells two products. Data concerning those products for the most recent month appear below: Fixed expenses for the entire company were $42,550.If the sales mix were to shift toward Product B32L with total sales remaining constant, the overall break-even point for the entire company:

The margin of safety percentage is equal to the margin of safety in dollars divided by total contribution margin.

Furlan Printing Corporation, a book printer, has provided the following data: Management believes that the press setup cost is a mixed cost that depends on the number of titles printed. (A specific book that is to be printed is called a "title". Typically, thousands of copies will be printed of each title. Specific steps must be taken to setup the presses for printing each title-for example, changing the printing plates. The costs of these steps are the press setup costs.)Required:Estimate the variable cost per title printed and the fixed cost per month using the least-squares regression method.

Iverson Corporation's variable expenses are 60% of sales. At a $400,000 sales level, the degree of operating leverage is 5. If sales increase by $40,000, the new degree of operating leverage will be (rounded) :

The February contribution format income statement of Mcabier Corporation appears below: The degree of operating leverage is closest to:

Grawburg Inc. maintains a call center to take orders, answer questions, and handle complaints. The costs of the call center for a number of recent months are listed below: Management believes that the cost of the call center is a mixed cost that depends on the number of calls taken.Required:Estimate the variable cost per call and fixed cost per month using the least-squares regression method. (Round the "Variable cost" to 2 decimal places and the "Fixed cost" to the nearest dollar amount.)

Wight Corporation has provided its contribution format income statement for June. The company produces and sells a single product. If the company sells 5,000 units, its total contribution margin should be closest to: (Do not round intermediate calculations.)

Golebiewski Corporation has provided the following contribution format income statement. Assume that the following information is within the relevant range. The margin of safety percentage is closest to:

The selling price of Old Corporation's only product is $180.00 per unit and its variable expense is $37.80 per unit. The company's monthly fixed expense is $483,480.Required: Assume the company's monthly target profit is $56,880. Determine the unit sales to attain that target profit.

Bois Corporation has provided its contribution format income statement for January. The degree of operating leverage is closest to:

Sorin Incorporated, a company that produces and sells a single product, has provided its contribution format income statement for January. If the company sells 4,600 units, its total contribution margin should be closest to:

In July, Meers Corporation sold 3,700 units of its only product. Its total sales were $107,300, its total variable expenses were $66,600, and its total fixed expenses were $34,800.Required:a. Construct the company's contribution format income statement for July.b. Redo the company's contribution format income statement assuming that the company sells 3,400 units.

Majid Corporation sells a product for $240 per unit. The product's current sales are 41,300 units and its break-even sales are 36,757 units. What is the margin of safety in dollars?

Data concerning Buchenau Corporation's single product appear below: The break-even in monthly unit sales is closest to: (Round your intermediate calculations to 2 decimal places.)