- The contribution margin ratio equals:
- The variable expense ratio equals:
- Assume the following information:
| Amount | Per Unit | |
| Sales | $ 300,000 | $ 40 |
| Variable expenses | 112,500 | 15 |
| Contribution margin | 187,500 | $ 25 |
| Fixed expenses | 58,000 | |
| Net operating income | $ 129,500 |
The unit sales to break-even is:
- Assume the following:
- selling price per unit = $30
- variable expense per unit = $18
- total fixed expenses = $58,800
Given these three assumptions, the unit sales needed to achieve a target profit of $11,400 is:
- Assume the following:
- sales = $200,000
- unit sales = 10,000
- the contribution margin ratio = 30%
- net operating income = $10,000
Given these four assumptions, which of the following is true?
- If sales equal $326,000, variable expenses equal $200,000, and the degree of operating leverage is 15, then the net operating income is:
| 7. Which of the following statements is true?
8. Assume the following information for a company that produced and sold 10,000 units during its first year of operations:
Using absorption costing, what is the company’s unit product cost?
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- Assume the following information for a company that produced and sold 10,000 units during its first year of operations:
| Per Unit | Per Year | |
| Selling price | $ 200 | |
| Direct materials | $ 84 | |
| Direct labor | $ 50 | |
| Variable manufacturing overhead | $ 12 | |
| Sales commission | $ 8 | |
| Fixed manufacturing overhead | $ 300,000 |
Using variable costing, what is the company’s net operating income?
- Assume the following information for a company that produced 10,000 units and sold 9,000 units during its first year of operations:
| Per Unit | Per Year | |
| Selling price | $ 200 | |
| Direct materials | $ 75 | |
| Direct labor | $ 50 | |
| Variable manufacturing overhead | $ 8 | |
| Sales commission | $ 8 | |
| Fixed manufacturing overhead | $ 300,000 |
Using absorption costing, what is the cost of the company’s ending inventory?