Question: Reflex Manufacturing Corp. manufactures composters at a unit variable cost of $43. It sells them for $70 each. It can produce a maximum of 3200

Reflex Manufacturing Corp. manufactures composters at a unit variable cost of $43. It sells them for $70 each. It can produce a maximum of 3200 composters per month. Annual fixed costs total $648,000.
a. What is the break-even volume per month?
b. What is the monthly net income at a volume of 2500 units per month?
c. What is the monthly net income if Reflex operates at 50% of capacity during a recession?
d. At what percent utilization would the annual net income be $226,800?
e. If fixed and variable costs remain the same, how much do the monthly break-even unit sales change for a $1 increase in the selling price?

Step by Step Solution

★★★★★

3.40 Rating (172 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

Given VC 43 S 70 FC 648000year 54000month Production capacity 3200 composters ... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Document Format (1 attachment)

711-B-A-C-I (768).docx

120 KBs Word File

Students Have Also Explored These Related Accounting Questions!

Seville Company manufactures a product with a unit variable cost of $42 and a unit sales price of $75. Fixed costs were $80,000 when 10,000 units were produced and sold. The company has a one-time...

Baden Company manufactures a product with a unit variable cost of $50 and a unit sales price of $88. Fixed manufacturing costs were $240,000 when 10,000 units were produced and sold. The company has...

Reflex Manufacturing Corp. manufactures composters at a unit variable cost of $43. It sells them for $70 each. It can produce a maximum of 3200 composters per month. Annual fixed costs total...

W AutoSave O off) Total variable costs are (1).docx - Protected View . Saved to this PC v 9 Search (Alt+Q) A Vishal Vishal w X File Home Insert Draw Design Layout References Mailings Review View Help...

Reflex Manufacturing Corp. manufactures composters at a unit variable cost of $43. It sells them for $70 each. It can produce a maximum of 3200 composters per month. Annual fixed costs total...

Reflex Manufacturing Corp. manufactures composters at a unit variable cost of $ 4 3 . It sells them for $ 7 3 each. It can produce a maximum of 3 , 5 0 0 composters per month. Annual fixed costs...

Solve using the Contribution Margin approach. Reflex Manufacturing Corp. manufactures composters at a unit variable cost of $43. It sells them for $70 each. It can produce a maximum of 3200...

Reflex Manufacturing Corp. manufactures composters at a unit variable cost of $61. It sells them for $86 each. It can produce a maximum of 4,800 composters per month Annual fixed costs total...

Florist Blossom Sdn Bhd (FB) has been in the flower and gift business for several years. The recent Covid-19 pandemic has affected the business quite severely in the year 2020. In December 2020, the...

A portfolio consists of 4 securities, 1, 2, 3, and 4. The proportions of these securities are w1=0.2, w2=0.3, w3=0.4, and w4=0.1. The standard deviations of returns on these securities (in percentage...

A portfolio of securities has a beta of 1 . 1 4 . Given this, you know that Multiple Choice the portfolio has 1 4 % more risk than a risk - free security. the expected return on the portfolio is...

Internal control includes detect controls and prevent controls. Which of the following is a detect control? (A) Signing overtime claim forms. (B) Matching purchase invoices with goods received...

The Consumer Price Index (based on a value of 100 in 2002) rose from 44.0 in 1980 to 78.4 in 1990. What was the (equivalent) annual rate of inflation in the decade of the 1980s?

Mutual funds with assets in precious metals have displayed high price volatility in recent years. For example, the Sentry Precious Metals Growth Fund had annual returns in successive years from 2010...

A $20,000-face-value strip bond was purchased for $10,045.94, providing the investor with a rate of return of 4.2% compounded semiannually. To the nearest day, how long before the maturity date was...

The Snedecker Corporation is considering a change in its cash-only policy. The new terms would be net one period. The required return is 1.6 percent per period. Based on the following information,...

QUESTION 6 If the simple CAPM is valid and all portfolios are priced correctly, which of the situations below is possible? Consider each situation independently, and assume the risk-free rate is 5%....

what is a compensating control in security controls?