The Beta Manufacturing Company produces stepladders that sell for $27 each. The production capacity is limited to

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Question:

The Beta Manufacturing Company produces stepladders that sell for $27 each. The production capacity is limited to 48,000 units per year. Fixed costs are $50,000 and variable costs are $12 per item. Compute the break-even point in number of stepladders. How many items must be sold to provide a profit of $20,000

What is allocation of fixed costs per stepladder at 75 percent capacity?

A firm produces four models of tool sets. The fixed costs are $42,000 and the other data are as follows:
•Sales
• Model Qty Price Variable Cost Revenue
• S 4,000 $20 6 $80,000
• T 5,000 32 8 $160,000
• U 1,000 60 20 $60,000
• V 2,000 50 18 $100,000
• Total $400,000
Determine the break-even in dollars.
What is the Margin of Safety if Sales =$75,000?

The Clutch Engineering Company is proposing to locate a branch office in one of two West Coast locations, A or B. These two sites have quite different estimated operating costs:
• A B
• Engineering labor cost $15/hr. $16/hr.
• Materials and supplies 2.40/hr. $1.80/hr.
• (tied to engineering hours)
• Variable overhead 5.50/hr. 4.40/hr.
• Total annual fixed cost $150,000 $190,000
• Price to customers. $30 $30
• Consider the hourly costs to be variable costs.
a. Compute the break-even for both locations.
b. At what level of output (number of hours) are you in- different to the location?