Question

In: Accounting

Find the break even point ? Rent is $10,000. Salaries to be paid is $50,000. Misc....

Find the break even point ?

Rent is $10,000. Salaries to be paid is $50,000. Misc. Fixed costs are $40,000.

Raw Materials are $4 per unit. Packaging is $.10 cents per unit. Direct Labor is $3.40 per unit. Sales price is $10.00 per unit.

If annual capacity was 30,000 units, how much would the sales price need to be to break even?

Solutions

Expert Solution

Ans. Calculation of Contribution per unit : (in $)

Sales perice per unit                      =     10

V/c (4+.10+3.40)                           =      7.50

Contribution per unit                       =     2.50

Total Fixed cost (10000+50000+40000) = $100000

Annual Capacity is 30000 units

Calculation of Sales price need to be to break even

Fixed cost                                =    $100000

V/c for 30000unit @7.5 per unit =    $225000

Total cost for 30000unit             =    $325000

Sales price per unit to be charge to be break even = 325000/30000 = $10.8333

Sale price need to be break even if annual capacity is 30000 units = $10.8333

                            = 90000/2.5 = 36000

ekkarill92 answered 1 year ago
Next > < Previous

Related Solutions

Find the break even point ? Rent is $10,000. Salaries to be paid is $50,000. Misc....
Find the break even point ? Rent is $10,000. Salaries to be paid is $50,000. Misc. Fixed costs are $40,000. Raw Materials are $4 per unit. Packaging is $.10 cents per unit. Direct Labor is $3.40 per unit. Sales price is $10.00 per unit. If annual capacity was 30,000 units, how much would the sales price need to be to break even?
Break-Even Point
S.S Corporation had sales of Rs. 4,500,000. The fixed expense was Rs. 1,200,000 and variable expense totaled Rs. 1,800,000. You are required to calculate Break-Even Point for S.S Corporation.
how does the break-even point fit into this discussion? What is the break-even point? Why is...
how does the break-even point fit into this discussion? What is the break-even point? Why is it an important concept in managerial accounting? What are its uses?
a. How are contribution margin and break even related? b. What happens to break even point...
a. How are contribution margin and break even related? b. What happens to break even point if variable cost per unit changes, if fixed cost changes? c. Explain the degree of operating leverage and how it is related to a companies profit risk.
Q2. (a) WHAT IS BREAK - EVEN POINT? (b) EXPLAIN THE IMPORTANT MANAGERIAL USES OF BREAK-EVEN...
Q2. (a) WHAT IS BREAK - EVEN POINT? (b) EXPLAIN THE IMPORTANT MANAGERIAL USES OF BREAK-EVEN ANALYSIS.
Slove Lady M Break Even Excel with formulas YEAR ONE Break-even Rent $                    310,600.00 Utilities $  &nbs
Slove Lady M Break Even Excel with formulas YEAR ONE Break-even Rent $                    310,600.00 Utilities $                      38,644.00 Labor $                    594,750.00 COGS (50% of Gross Sales) $                    944,620.00 Total Cost $                 1,888,614.00 Gross Sales $                 1,889,240.00 Average Retail per Cake $                             80.00 Cakes Sold per year                               23,616 Cakes Sold per day 64.7 Net Income $                           626.00 Margin 0.03% Growth Rate Year One Year Two Year Three Year Four Year Five Rent (3% escalation) $                    310,600.00 Utilities (3% escalation) $                      38,644.00 Labor (5% escalation) $                    594,750.00 COGS (50% of Gross Sales) $                    944,620.00 Total...
Find the break-even point for the revenue and cost. Draw your own graph on a piece...
Find the break-even point for the revenue and cost. Draw your own graph on a piece of paper. Fixed cost = $22,000 Variables cost = $15 per item Price = $23 The break-even point is at ________ items.
What is the break-even point in unit sales?
Oslo Company prepared the following contribution format income statement based on a sales volume of 1,000 units (the relevant range of production is 500 units to 1,500 units): Sales $ 90,000 Variable expenses 49,500 Contribution margin 40,500 Fixed expenses 33,210 Net operating income $ 7,290 What is the break-even point in unit sales?
Determine the (a) break-even point in sales units and (b) break-even point in sales units assuming that the selling price is increased to $67 per unit
Nicolas Enterprises sells a product for $60 per unit. The variable cost is $35 per unit, while fixed costs are $80,000. Determine the (a) break-even point in sales units and (b) break-even point in sales units assuming that the selling price is increased to $67 per unit
STRATEGIC COST MANAGEMENT - BREAK-EVEN POINT AND CVP ANALYSIS
Cornwell Company is in business since 2010, makes swimwear for professional athletes. Analysis of the firm's record for the year reavelas the following:                 Average swimsuit selling price                      $140                 Average swimsuit expenses:                     Direct Material                       ...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT