What is the companys break-even point in dollars

Assignment Help Accounting Basics

Reference no: EM133629116

Assignment: Accounting

Question I. Calculate the per-unit contribution margin of a product that has a sale price of $200 if the variable costs per unit are $65.

Question II. A product has a sales price of $150 and a per-unit contribution margin of $50. What is the contribution margin ratio?

Question III. Maple Enterprises sells a single product with a selling price of $75 and variable costs per unit of $30. The company's monthly fixed expenses are $22,500.

1. What is the company's break-even point in units?
2. What is the company's break-even point in dollars?
3. Construct a contribution margin income statement for the month of September when they will sell 900 units.
4. How many units will Maple need to sell in order to reach a target profit of $45,000?
5. What dollar sales will Maple need in order to reach a target profit of $45,000?
6. Construct a contribution margin income statement for Maple that reflects $150,000 in sales volume.

Question IV. Company A has current sales of $10,000,000 and a 45% contribution margin. Its fixed costs are $3,000,000. Company B is a service firm with current service revenue of $5,000,000 and a 20% contribution margin. Company B's fixed costs are $500,000. Compute the degree of operating leverage for both companies. Which company will benefit most from a 25% increase in sales? Explain why.

Question V. Marshall & Company produces a single product and recently calculated their break-even point as shown.

                                       Current
Units sold                                 400
Sales price per unit                    $ 550
Variable cost per unit                 $ 375
Contribution margin per unit       $ 175
Fixed costs                               $ 3,500
Break-even (in units)                 20
Contribution margin ratio           31.82%
Break-even (in dollars)               $11,000

What would Marshall's target margin of safety be in units and dollars if they required a $14,000 margin of safety?

Reference no: EM133629116

Questions Cloud

How might the perspective shift the strategy of the group : Most medical specialty groups historically have relied on primary care physician practices for referral. How might this perspective shift the strategy of group?

What is the value proposition of your companys product : Who is the target customer for your company's product? What is the value proposition of your company's product?

Discuss the pros and cons of protectionist policies : Discuss the pros and cons of protectionist policies, arguing for and against protectionism. Base your debate on facts and arguments.

Major areas of cost associated with white-collar crime : Discussion of the three major areas of cost associated with white-collar crime. Apply your discussion to two (2) examples of healthcare fraud

What is the companys break-even point in dollars : What is the company's break-even point in dollars? Construct a contribution margin income statement for the month of September when they will sell 900 units.

Drawing on edwin sutherlands definition : CJ440 White Collar Crime, Ashworth College - Drawing on Edwin Sutherlands definition of white-collar crime's two distinct elements

Why it important for businesses to follow ethical practices : Identify and summarize the key ethical issues highlighted in the Enron scandal. Why is it important for businesses to follow ethical practices?

Discuss the themes that you found in research from articles : Current Trends Paragraph: In this paragraph, you will discuss the themes that you found in the research from the 5 articles related to your topic.

What have researchers learn about impact of lack of training : What have researchers learned about impact of lack of employee training on workplace performance and what strategy exist to address or mitigate issue?

User Account

All Pages