Question

- For Coronado Industries, sales is $2500000, fixed expenses are $900000, and the contribution margin ratio is 36%. What is required sales in dollars to earn a target net income of $700000?

- Swifty Corporation reported sales of $1600000 last year (80000 units at $20 each), when the break-even point was 72000 units. Swifty’s margin of safety ratio is?

- In 2016, Coronado Industries sold 3000 units at $750 each. Variable expenses were $460 per unit, and fixed expenses were $780000. The same variable expenses per unit and fixed expenses are expected for 2017. If Coronado cuts selling price by 4%, what is Coronado’s break-even point in units for 2017?

- Vaughn Manufacturing sells two types of computer hard drives. The sales mix is 30% (Q-Drive) and 70% (Q-Drive Plus). Q-Drive has variable costs per unit of $165 and a selling price of $210. Q-Drive Plus has variable costs per unit of $180 and a selling price of $255. The weighted-average unit contribution margin for Vaughn is?

- Bramble Corp. sells two types of computer hard drives. The sales mix is 30% (Q-Drive) and 70% (Q-Drive Plus). Q-Drive has variable costs per unit of $150 and a selling price of $210. Q-Drive Plus has variable costs per unit of $165 and a selling price of $255. Bramble’s fixed costs are $729000. How many units of Q-Drive would be sold at the break-even point?

- Crane Company can produce and sell only one of the following two products:

	Oven	Contribution
	Hours Required	Margin per Unit
Muffins	0.2	$2
Coffee Cakes	0.3	$8

The company has oven capacity of 2250 hours. How much will contribution margin be if it produces only the most profitable product?

- Crane Company has sales of $1000000, variable costs of $400000, and fixed costs of $500000. Crane’s degree of operating leverage is?

- Sheridan Company has sales of $2500000, variable costs of $1000000, and fixed costs of $810000. Sheridan’s margin of safety ratio is?

Answer 1