Kerplunk Industries produces one type of noisy toy with the following price and costs: Sales price $9.80
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Question:
Kerplunk Industries produces one type of noisy toy with the following price and costs:
Sales price $9.80 per unit
Variable cost 6.30 per unit
Total fixed costs 175,000 per year
Required:
- What is the contribution margin per unit? Show computations below.
- How many units must be sold to breakeven? Show computation below.
- How many units must be sold to make an operating profit of $50,000? Show computation below.
- If 60,000 units are sold what is the operating profit (loss)? Show computation below.
- What would be the breakeven point in units if the sales price decreased by $.50/unit? Show computation below.
- Independent from question 5, what would be the breakeven point in units if variable cost per unit decreased by 30%? Show computation below.
- Independent from questions 5 & 6, what would be the breakeven point in units if fixed costs increased by $25,000? Show computation below.
Related Book For
Managerial Accounting An Introduction to Concepts Methods and Uses
ISBN: 978-0324639766
10th Edition
Authors: Michael W. Maher, Clyde P. Stickney, Roman L. Weil
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