FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 2: Cost-Volume-Profit Relationships

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 81

Multiple Choice

Review LaterAdd Note

Review Later

Lore Corporation has provided the following information: Lore's break-even point in dollar sales is:

A) $50, 000
B) $10, 000
C) $12, 500
D) $40, 000

E) All of the above
F) None of the above

Correct Answer

verified

Show Answer

Question 82

True/False

Review LaterAdd Note

Review Later

The unit sales volume necessary to reach a target profit is determined by dividing the sum of the fixed expenses and the target profit by the contribution margin per unit.

A) True
B) False

Correct Answer

verified

Show Answer

Question 83

Multiple Choice

Review LaterAdd Note

Bohlen Corporation produces and sells a single product.Data concerning that product appear below: Fixed expenses are $716, 000 per month.The company is currently selling 6, 000 units per month.Consider each of the following questions independently. This question is to be considered independently of all other questions relating to Bohlen Corporation.Refer to the original data when answering this question. The marketing manager would like to introduce sales commissions as an incentive for the sales staff.The marketing manager has proposed a commission of $16 per unit.In exchange, the sales staff would accept a decrease in their salaries of $84, 000 per month.(This is the company's savings for the entire sales staff. ) The marketing manager predicts that introducing this sales incentive would increase monthly sales by 600 units.What should be the overall effect on the company's monthly net operating income of this change?

In the most recent month, Shoemaker Corporation's total contribution margin was $29, 600 and its net operating income $3, 000. Required: a.Compute the degree of operating leverage to two decimal places. b.Using the degree of operating leverage, estimate the percentage change in net operating income that should result from a 10% increase in sales.

Data concerning Massing Corporation's single product appear below: The company is currently selling 9, 000 units per month.Fixed expenses are $837, 000 per month.The marketing manager believes that a $16, 000 increase in the monthly advertising budget would result in a 150 unit increase in monthly sales.What should be the overall effect on the company's monthly net operating income of this change?

A tile manufacturer has supplied the following data: If the company increases its unit sales volume by 5% without increasing its fixed expenses, then total net operating income should be closest to:

Data concerning Bunck Corporation's single product appear below: Fixed expenses are $202, 000 per month.The company is currently selling 2, 000 units per month.Management is considering using a new component that would increase the unit variable cost by $18.Since the new component would increase the features of the company's product, the marketing manager predicts that monthly sales would increase by 400 units.What should be the overall effect on the company's monthly net operating income of this change?

Bohlen Corporation produces and sells a single product.Data concerning that product appear below: Fixed expenses are $716, 000 per month.The company is currently selling 6, 000 units per month.Consider each of the following questions independently. This question is to be considered independently of all other questions relating to Bohlen Corporation.Refer to the original data when answering this question. The marketing manager believes that a $20, 000 increase in the monthly advertising budget would result in a 180 unit increase in monthly sales.What should be the overall effect on the company's monthly net operating income of this change?

Reynold Enterprises sells a single product for $25.The variable expense per unit is $15 and the fixed expense per unit is $5 at the current level of sales.The company's net operating income will increase by $10 if one more unit is sold.

Contribution margin is the amount remaining after:

Koelsch Corporation's only product sells for $170 per unit.Its current sales are 43, 600 units and its break-even sales are 39, 240 units. Required: Compute the margin of safety in both dollars and as a percentage of sales.

Wyly Inc.produces and sells a single product.The selling price of the product is $170.00 per unit and its variable cost is $62.90 per unit.The fixed expense is $356, 643 per month. The break-even in monthly dollar sales is closest to:

Data concerning Marchman Corporation's single product appear below: The company is currently selling 4, 000 units per month.Fixed expenses are $166, 000 per month.Consider each of the following questions independently. This question is to be considered independently of all other questions relating to Marchman Corporation.Refer to the original data when answering this question. The marketing manager would like to cut the selling price by $7 and increase the advertising budget by $11, 000 per month.The marketing manager predicts that these two changes would increase monthly sales by 800 units.What should be the overall effect on the company's monthly net operating income of this change?

Data concerning Matsumoto Corporation's single product appear below: Assume the company's target profit is $5, 000.The unit sales to attain that target profit is closest to:

At a break-even point of 800 units sold, White Corporation's variable expenses are $8, 000 and its fixed expenses are $4, 000.What will the Corporation's net operating income be at a volume of 801 units?

Macmullen Corporation produces and sells two products.Data concerning those products for the most recent month appear below: The fixed expenses of the entire company were $30, 970.If the sales mix were to shift toward Product D08Q with total dollar sales remaining constant, the overall break-even point for the entire company:

A tile manufacturer has supplied the following data: The company's contribution margin ratio is closest to:

Shauer, Inc. , produces and sells a single product whose selling price is $150.00 per unit and whose variable expense is $33.00 per unit.The company's fixed expense is $436, 410 per month. Required: Determine the monthly break-even in either unit or total dollar sales.Show your work!

The contribution margin ratio of Donath Corporation's only product is 65%.The company's monthly fixed expense is $573, 300 and the company's monthly target profit is $9, 100. Required: Determine the dollar sales to attain the company's target profit.Show your work!

Bohlen Corporation produces and sells a single product.Data concerning that product appear below: Fixed expenses are $716, 000 per month.The company is currently selling 6, 000 units per month.Consider each of the following questions independently. This question is to be considered independently of all other questions relating to Bohlen Corporation.Refer to the original data when answering this question. The marketing manager would like to cut the selling price by $17 and increase the advertising budget by $42, 000 per month.The marketing manager predicts that these two changes would increase monthly sales by 1, 000 units.What should be the overall effect on the company's monthly net operating income of this change?