Question 1

If the selling price per unit is $42, the unit contribution margin is $15, and total fixed expenses are $570,000, what will the breakeven sales in units be?

Accepted Answer

A)Fixed expenses $570,000 divided by Contribution Margin $15 = 38,000 BE units

Question 2

Martin Enterprises provides the following information about its single product.  What is the breakeven point in units?

Accepted Answer

The answer of Martin Enterprises provides the following information about...

Question 3

Given breakeven sales in units of 45,000 and a unit contribution margin of $4, how many units must be sold to reach a target operating income of $18,000?

Accepted Answer

First, let's calculate the current total contribution margin at the breakeven point:
45,000 units x $4 contribution margin per unit = $180,000

Now we need to factor in the target operating income of $18,000:
$180,000 + $18,000 = $198,000

We can use this new total contribution margin to calculate the number of units needed to reach the target operating income:
$198,000 ÷ $4 contribution margin per unit = 49,500 units

Therefore, the correct answer is C.

Question 4

If the selling price per unit is $70, variable expenses per unit are $45, target operating income is $38,000, and total fixed expenses are $22,000, how many units must be sold to reach the target operating income?

Accepted Answer

B)
Sales $70
Less Variable costs 45
= Contribution Margin $25
Fixed expenses $22,000 + Target Income $38,000 = $60,000 divided by Contribution Margin
$25 = 2,400 BE units

Question 5

Washington Bottling Company provides the following information about its single product.  What is the contribution margin per unit?

Accepted Answer

The answer of Washington Bottling Company provides the following information...

Question 6

A product is sold at $6 per unit, the unit contribution margin is $5, and total fixed expenses are $5,000, what are the breakeven sales in units?

Accepted Answer

B)Fixed Expenses $5,000 divided by Contribution Margin $5 = 1,000 Breakeven

Question 7

A product is sold at $60.00 per unit, the variable expense per unit is $30, and total fixed expenses are $200,000, what are the breakeven sales in dollars?

Accepted Answer

D)
Sales $60
Less Variable costs 30
= Contribution Margin 30 divided by $60 = 50%
Fixed Expense $200,000 divided by Contribution Margin Ratio 50% = $400,000

Question 8

If the selling price per unit is $10, the unit contribution margin is $5, and total fixed expenses are $15,000, what are the breakeven sales in units?

Accepted Answer

D)Fixed Expenses $15,000 divided by Contribution Margin $5 = 3,000 Breakeven

Question 9

Martin Enterprises provides the following information about its single product.  How many units must be sold to earn the targeted operating income?

Accepted Answer

The answer of Martin Enterprises provides the following information about...

Question 10

If the contribution margin ratio is 45%, target operating income is $50,000, and the sales revenue needed to achieve the target operating income is $300,000, what are total fixed expenses?

Accepted Answer

B)
Fixed expenses + $50,000 / 45% = 300,000 Sales Revenue
Fixed Expenses = $85,000

Question 11

Washington Bottling Company provides the following information about its single product.  What is the breakeven point in units?

Accepted Answer

The breakeven point in units can be calculated using the formula:
Breakeven Point = Fixed Costs / (Price per unit - Variable Costs per unit)

In this case, the fixed costs are $391,500 and the variable costs per unit are $3.30. The price per unit is $7.50 - $0.60 = $6.90 (since the discount is subtracted from the original price). Plugging these values into the formula, we get:
Breakeven Point = $391,500 / ($6.90 - $3.30) = 56,100 units.

Therefore, the best choice is C.

Question 12

If the selling price per unit is $40.00, the variable expense per unit is $30, and total fixed expenses are $200,000, what are the breakeven sales in dollars?

Accepted Answer

C)
Sales $40
Less Variable costs 30
= Contribution Margin 10 divided by $40 = 25%
Fixed Expense $200,000 divided by Contribution Margin Ratio 25% = $800,000

Question 13

If target sales in units is 80,000, total fixed expenses are $10,000, and the unit contribution margin is $0.30, what is the target operating income?

Accepted Answer

B)
Target Sales units 80,000
× unit Contribution Margin × .30
Target Sales 24,000
Less Fixed expense 10,000
Target Operating Income $14,000

Question 14

Martin Enterprises provides the following information about its single product.  What is the contribution margin per unit?

Accepted Answer

The contribution margin per unit can be calculated as follows:
Selling price per unit = $27
Variable cost per unit = $24.70 - $6.60 - $2.80 = $15.30
Contribution margin per unit = Selling price per unit - Variable cost per unit
= $27 - $15.30
= $11.70
Therefore, the contribution margin per unit is $11.70 which is closest to option C ($2.30).

Question 15

Washington Bottling Company provides the following information about its single product.  How many units must be sold to earn the targeted operating income?

Accepted Answer

The answer of Washington Bottling Company provides the following information...

Question 16

If total fixed costs are $455,000, the contribution margin per unit is $25.00, and targeted operating income is $25,000, how many units must be sold to breakeven?

Accepted Answer

Breakeven point can be calculated using the formula:

Breakeven point (units) = Fixed Costs / Contribution Margin per unit

Substituting the given values, we get:

Breakeven point (units) = $455,000 / $25.00 = 18,200 units

To achieve a targeted operating income of $25,000, contribution margin must cover fixed costs plus the operating income:

Fixed Costs + Targeted Operating Income = (Units sold x Contribution Margin per unit)

$455,000 + $25,000 = (Units sold x $25)

$480,000 = (Units sold x $25)

Units sold = $480,000 / $25 = 19,200 units

However, since the question asks for breakeven point, the correct answer is 18,200 units.

Question 17

If the selling price per unit is $65, the variable expense per unit is $45, and total fixed expenses are $250,000, what will the breakeven sales in units be?

Accepted Answer

A)
Sales $65
Less Variable costs 45
= Contribution Margin $20
Fixed expenses $250,000 divided by Contribution Margin $20 = 12,500 BE units

Question 18

Corny and Sweet grows and sells sweet corn at its roadside produce stand. The selling price per dozen is $3.75, variable costs are $1.25 per dozen, and total fixed costs are $750.00. What are breakeven sales in dollars?

Accepted Answer

D)
Sales $3.75
Variable costs 1.25
Contribution Margin $2.50
Fixed Expenses $750 divided by Contribution Margin $2.50 = 300 Breakeven
Breakeven Sales units 300 × $3.75 = $1,125 Breakeven sales dollars

Question 19

Assume the following amounts:  If sales revenue per unit increases to $22 and 12,000 units are sold, what is the operating income?

Accepted Answer

The answer of Assume the following amounts:  If sales...

Question 20

Given breakeven sales in units of 34,000 and a unit contribution margin of $5, how many units must be sold to reach a target operating income of $8,000?

Accepted Answer

C)
Target Income $8,000 / $5 contribution margin = 1,600
Add Break even units + 34,000
Total units 35,600

Quiz 7: Cost-Volume-Profit Analysis

If the selling price per unit is $42, the unit contribution margin is $15, and total fixed expenses are $570,000, what will the breakeven sales in units be?

Martin Enterprises provides the following information about its single product. What is the breakeven point in units?

Given breakeven sales in units of 45,000 and a unit contribution margin of $4, how many units must be sold to reach a target operating income of $18,000?

If the selling price per unit is $70, variable expenses per unit are $45, target operating income is $38,000, and total fixed expenses are $22,000, how many units must be sold to reach the target operating income?

Washington Bottling Company provides the following information about its single product. What is the contribution margin per unit?

A product is sold at $6 per unit, the unit contribution margin is $5, and total fixed expenses are $5,000, what are the breakeven sales in units?

A product is sold at $60.00 per unit, the variable expense per unit is $30, and total fixed expenses are $200,000, what are the breakeven sales in dollars?

If the selling price per unit is $10, the unit contribution margin is $5, and total fixed expenses are $15,000, what are the breakeven sales in units?

Martin Enterprises provides the following information about its single product. How many units must be sold to earn the targeted operating income?

If the contribution margin ratio is 45%, target operating income is $50,000, and the sales revenue needed to achieve the target operating income is $300,000, what are total fixed expenses?

Washington Bottling Company provides the following information about its single product. What is the breakeven point in units?

If the selling price per unit is $40.00, the variable expense per unit is $30, and total fixed expenses are $200,000, what are the breakeven sales in dollars?

If target sales in units is 80,000, total fixed expenses are $10,000, and the unit contribution margin is $0.30, what is the target operating income?

Martin Enterprises provides the following information about its single product. What is the contribution margin per unit?

Washington Bottling Company provides the following information about its single product. How many units must be sold to earn the targeted operating income?

If total fixed costs are $455,000, the contribution margin per unit is $25.00, and targeted operating income is $25,000, how many units must be sold to breakeven?

If the selling price per unit is $65, the variable expense per unit is $45, and total fixed expenses are $250,000, what will the breakeven sales in units be?

Corny and Sweet grows and sells sweet corn at its roadside produce stand. The selling price per dozen is $3.75, variable costs are $1.25 per dozen, and total fixed costs are $750.00. What are breakeven sales in dollars?

Assume the following amounts: If sales revenue per unit increases to $22 and 12,000 units are sold, what is the operating income?

Given breakeven sales in units of 34,000 and a unit contribution margin of $5, how many units must be sold to reach a target operating income of $8,000?