Cost Accounting Midterm

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ADM 3346A
COST ACCOUNTING
Solution

Fall 2010
Midterm Examination

STUDENT NAME: _________________________________________________
STUDENT NUMBER: ________________________________________________

90 minutes
INSTRUCTIONS
1.
2.
3.
4.

Books and notes are not permitted, except language dictionaries.
Non programmable calculators are permitted.
Put all answers in the question booklet
Questions concerning possible errors in the exam only will be answered.

Questions

Max Points

Question 1

/10

Question 2

/6

Question 3

/4

Question 4

/6

Question 5

/6

Question 6

/8

Question 7

/10

Question 8

/6

Question 9

/4

Question 10

/6

Total

/66

Statement of Academic
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Midterm ADM 3346A Fall 2010

Page 2 of 10

Q.2. (6)
.
Sell Block prepares three types of simple tax returns: individual, partnerships, and (small) corporations.
The tax returns have the following characteristics:

Price charged per tax return
Variable cost per tax return
(including wage paid to tax preparer)
Expected tax returns prepared per year

Individuals
$200

Partnerships
$1,000

Corporations
$2,000

$120
60,000

$700
4,000

$1,500
16,000

The total fixed costs per year for the company are $4,025,000.
Required
a.
b.

c.

What is the break even point in total tax returns given the expected mix above?
Suppose the product sales mix changes so
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