Question

9).Data concerning Cincinnati Supply Corp.'s, a supplier to Kraft Foods, single product appear below:

Selling price per unit: $150.00

Variable expense per unit: $49.50

Fixed expense per month: $138,690

The break-even in monthly dollar sales is closest to:

Group of answer choices

a). $207,000 b). $138,690 c). $420,273 d).$255,321

10).Data for March for Cincinnati Supply Corp., a supplier to Proctor and Gamble, and its two major divisions, Hair Care and Skin Care, appear below:

Sales revenue, Hair Care $500,000

Variable expenses, Hair Care $300,000

Sales revenue, Skin Care $750,000

Variable expenses, Skin Care $325,000

In addition, total fixed expenses are $ 500,000. Of that amount $75,000 is traceable to the Hair Care division and $150,000 is traceable to the Skin Care division.

The breakeven in sales dollars of the Hair Care division is:

Group of answer choices

a). $125,000 b).$187,500 c).$263,158 d).$200,000

11).Data for March for Cincinnati Supply Corp., a supplier to Proctor and Gamble, and its two major divisions, Hair Care and Skin Care, appear below:

Sales revenue, Hair Care $500,000

Variable expenses, Hair Care $300,000

Sales revenue, Skin Care $750,000

Variable expenses, Skin Care $325,000

In addition, total fixed expenses are $ 500,000. Of that amount $75,000 is traceable to the Hair Care division and $150,000 is traceable to the Skin Care division.

The segment margin of the Skin Care division is:

Group of answer choices

a). $275,000 b).$125,000 c).$425,000 d).$200,000

12).Cincinnati Supply Corp., a supplier to Kraft Foods, has two divisions: the Alpha Division and the Charlie Division. The Alpha Division has sales of $230,000, variable expenses of $131,100, and traceable fixed expenses of $63,300. The Charlie Division has sales of $540,000, variable expenses of $291,600 and traceable fixed expenses of $120,700. The total amount of common fixed expenses not traceable to the individual divisions is $119,200. What is the breakeven in sales for Charlie division?

Group of answer choices:

a).$147,209 b).$262,391 c).$521,522 d).$340,509

Answer 1

9.

Contribution margin percentage = (Selling price per unit - Variable expenses per unit) / Selling price per unit

= ($150 - $49.5) / $150

= 0.67

Break-even in monthly dollar sales = Fixed expenses / Contribution margin percentage

= $138,690 / 0.67

= $207,000

The answer is a.

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10.

Contribution margin percentage = (Sales revenue - Variable expenses) / Sales revenue

= ($500,000 - $300,000) / $500,000

= 0.4

Breakeven in sales dollars = Fixed expenses / Contribution margin percentage

= $75,000 / 0.4

= $187,500

The answer is b.

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11.

Segment margin = Sales revenue - Variable expenses - Traceable fixed expenses

= $750,000 - $325,000 - $150,000

= $275,000

The answer is a.

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12.

Contribution margin percentage = (Sales revenue - Variable expenses) / Sales revenue

= ($540,000 - $291,600) / $540,000

= 0.46

Breakeven in sales dollars = Fixed expenses / Contribution margin percentage

= $120,700 / 0.46

= $262,391

The answer is b.