A product has a prime cost of £15, variable overhead of £5 per unit and fixed overheads of £8 per unit. Which pricing policy gives the highest price? A. Prime cost +60% B. Marginal cost+40% C. Average Total Costs +10% D. Net margin of 20% on selling price.

A product has a prime cost of £15, variable overhead of £5 per unit and fixed overheads of £8 per unit. Which pricing policy gives the highest price? A. Prime cost +60% B. Marginal cost+40% C. Average Total Costs +10% D. Net margin of 20% on selling price.

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter7: Variable Costing For Management analysis

Section: Chapter Questions

Problem 4BE

See similar textbooks

Related questions

Q: These financial statement items are for Sunland Corporation at year end, July 31, 2021: Operating…

A: Statement of changes in equity is the one which is prepared to determine the ending balance of…

Q: Meiger Mining, Inc., has just discovered two new mining sites for iron ore. Geologists and engineers…

A: For calculation of the Overall Target Cost per ton, we need to calculate the expected return

Q: Bluestone Company had three intangible assets at the end of the current year: A patent purchased…

A: Intangible Assets According to IAS 38 which specifies the standards for identifying and valuing…

Q: Determine which product KLP Co. should sell at the split-off point and which product KLP Co. should…

A: Joint Product :— Two are More Products separated in the Course of Processing each having sufficient…

Q: (40) Obsolescence may cause an asset's useful life to be longer than the asset's physical life -…

A: Obsolescence: When an item in a store's inventory or a fixed asset has become obsolete, its…

Q: S Inc follows ASPE but is planning to switch to IFRS in 2022. Beginning defined benefit obligation…

A: 1. The plan assets fair value at January 1, 2021 is underfunded by 60% of the DBO $1136-60% = 454.4…

Q: The accountant for Sysco Company is preparing the company's statement of cash flows for the fiscal…

A: The cash flow statement is prepared to record the cash flow from various activities during the…

Q: Why is a clear understanding of management’s goals and objectives necessary for effective budgets?

A: Budgeting is a process of planning future expenses and income so that an organization ensure the…

Q: Horizontal Analysis The comparative accounts payable and long-term debt balances for a company…

A: Amount of change Increase/Decrease Percentage Account payable $ 11,284 Increase 26% Long-term…

Q: Does the brand value of $220,000 get taken up in the aquisition analysis or considersation? Or is…

A: Brand value refers worth in monetary terms of the brand, if person would sell it and when company…

Q: Required information [The following information applies to the questions displayed below.] Organic…

A: Bank reconciliation statement: A bank reconciliation statement is a statement that reconciles the…

Q: 1. Consider the following cash flow payments: An income of $2000 at the end of year 2, an income of…

A: Cash flow diagrams visually represents cash inflows and outflows through a diagram, where any…

Q: Sylvia Company has a long-term plant asset with the following information as of the end of the year:…

A: When fair value of asset is reduced/declined lower than its carrying value then the difference value…

Q: 4. BE.12.03.ALGO 5. BE.12.08.ALGO 6. BE.12.01.ALGO 7. BE.12.07 8. BE.11.07 stock. The following…

A: There are two types of stocks. One is preferred stock and the other is common stock. Preferred…

Q: 6%-During year 3 ABC company agreed to sell a subsidiary. The sale was completed in March year 4 and…

A: All those operations or entities which are shut down by the company and are reported separately in…

Q: Use the following information and the indirect method to calculate the net cash provided or used by…

A: Operating activities in the cash flow statement refers to the one which reports the cash payments or…

Q: Using the categories of liquidity, profitability and operations management describe which ratios…

A: Solution Ratios analysis is used to determine the information regarding organisation's…

Q: Bilbo Baggin exchange, Bilbo signs an installment note. erms of the note require that Bilbo make…

A: A B C D E period ending date Beginning Balance Debit Interest Expense Debit Notes Payable…

Q: Question 4.1 Calculate the Economic Order Quantity for Love for bookstore Question 4.2 Calculate the…

A: Economic order quantity :— Economic order quantity (EOQ) is a calculation companies perform that…

Q: 2019 Dec. 2020 Mar. Sep. Nov. Dec. Dec. 31 Estimated that bad debt expense for the year was 4…

A: A balance sheet is a representation of an individual's personal or corporation's financial balances…

Q: Calculate the due date, interest due, and maturity value of the following notes:…

A: The interest receivable is the interest earned but not received yet. The maturity value is…

Q: Max disposed of two residential properties during the year. The details of the dispositions are as…

A: Basic assumption:- The house sold by Max is his main house and he…

Q: On January 3, 2020, Flint Limited purchased 3,800 (38%) of the common shares of Sonja Corp. for…

A: Since you have specifically asked for last part, so we have answered the same for you. Journal…

Q: PSMO Company currently uses normal costing method in accumulating the cost o production. The…

A: Total manufacturing costs includes raw material used, direct labour costs incurred and all overhead…

Q: Record the first semiannual interest payment on December 31, 2019 Record the necessary journal…

A: The bond will be recognised at discount value as the market interest is higher than the quoted rate…

Q: Current Attempt in Progress Carla Vista, Inc. leased equipment from Tower Company under a 4-year…

Q: Wetherald Products, Incorporated, has a Pump Division that manufactures and sells a number of…

A: Minimum Acceptable Transfer Price :— It is the variable cost plus opportunity costs. If the…

Q: On December 31. Sulfur Corporation has the following data available: Net Income…

A: Return on equity: Return on equity measures the company financial performance by dividing the net…

Q: How much will be the total shareholders' equity from the following: 6% Preference shares, P50 par,…

A: The shareholder's equity includes the share capital issued to shareholders and retained earnings…

Q: Inventory data for Lily Company are reported as follows. Explanation Units Unit Cost Inventory 150…

A: There are different methods of inventory valuation which includes; FIFO, LIFO and Weighted average.…

Q: Steam Room Inc. (SRI) has 15,000 shares issued in total. Assume that on January 1, 2021, Omega…

A: When one company is holding shares in another company from 20% to 50% , then it is called as…

Q: Which of the following methods is not allowed for tax purposes if FIFO (first in first out) is used…

A: Under FIFO(First in, First Out) method, inventories purchased first are assumed to be sold first.…

Q: Distribution center inventory (end-of-quarter): United states Canada Europe 497 45 19 53 5 34 20 9…

A: Inventory Turn over Ratio :— Inventory turnover is a financial ratio showing how many times a…

Q: Which of the following best describes a fixed cost? A. Increase proportionately with output. B.…

A: “Since you have asked multiple question, we will solve the first question for you. If you want any…

Q: Required information [The following information applies to the questions displayed below.] Del Gato…

A: Bank reconciliation statement is an important statement that helps in computing and determining the…

Q: On December 31st, Datton, Inc. has cost of goods sold of $540,000. ending inventory is $100,000,…

A: Accounts payable turnover is the ratio which is used to measure the rate at which the entity is…

Q: Compute the net present value of the project based on the original projections. (If the net present…

A: Net Present Value :— It is the sum of present value of all cash flows. If NPV is positive then…

Q: 2. You are in your second year as an auditor with Dantly and Regis, a regional CPA firm. One of the…

A: We are in the second year as an auditor with Dantly and Regis, a regional CPA firm. One of the…

Q: Which of the following would be considered a negative indicator when conducting a financial…

A: Financial analysis: Financial analysis is the process of evaluating finance-related transactions of…

Q: They apply to

A: Examples of like-kind properties: The like-kind properties should include assets that fall under the…

Q: Assume the following information for a capital budgeting proposal with a five-year time horizon:…

A: Internal rate of return (IRR): IRR is a rate at which the present value of cash inflows is equal to…

Q: 2. Compute the break-even point in dollar sales for the East region. 3. Compute the break-even point…

Q: Lawyer Lemon, a Jacksonville lawyer, specializes in what he calls credit management law. That is, he…

A: While having an Advertisement there are some rules and regulations which need to adhere while…

Q: On January 1, 2017, Satin Corp. issued eight-year, 6% bonds with a face value of $500,000, with…

A: Bonds refer to a financial security which is used by the borrowers to source required funds from a…

Q: The Gourmand Cooking School runs short cooking courses at its small campus. Management has…

A: The variance analysis is performed to compare the actual results with budgeted data of production.…

Q: Original payment of $3057 due today is settled by two equal payments due in 2 and 8 months. Assuming…

A: We will use the concept of time value of money here. As per the concept of time value of money the…

Q: Calculate Company Y's total asset turnover based on the following information for the current year:…

A: Total asset turnover ratio indicates ability of a company to generate revenue on its assets.…

Q: On January 1, 2021, a company issues 3-year bonds with a face value of $50,000 and a stated interest…

A: Interest expense = Issue price of bond × Market interest rate Cash paid = face value×stated interest…

Q: A company prepares the master budget by taking each division manager's estimate of revenues and…

A: Managers that use this technique run the risk of underestimating expectations and exceeding them. In…

Q: The following information is available for ABC Inc. on April 30 for the year just ended. a. Unpaid…

A: Adjusting journal entries are those journal entries which are passed at the end of the period for…

Question

A product has a prime cost of £15, variable overhead of £5 per unit and fixed
overheads of £8 per unit.
Which pricing policy gives the highest price?
A. Prime cost +60%
B. Marginal cost+40%
C. Average Total Costs +10%
D. Net margin of 20% on selling price.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

A companys product sells for $150 and has variable costs of $60 associated with the product. What is its contribution margin per unit? A. $40 B. $60 C. $90 D. $150
Lotts Company produces and sells one product. The selling price is 10, and the unit variable cost is 6. Total fixed cost is 10,000. Required: 1. Prepare a CVP graph with Units Sold as the horizontal axis and Dollars as the vertical axis. Label the break-even point on the horizontal axis. 2. Prepare CVP graphs for each of the following independent scenarios: (a) Fixed cost increases by 5,000, (b) Unit variable cost increases to 7, (c) Unit selling price increases to 12, and (d) Fixed cost increases by 5,000 and unit variable cost is 7.
If a company has fixed costs of $6.000 per month and their product that sells for $200 has a contribution margin ratio of 30%, how many units must they sell in order to break even? A. 100 B. 180 C. 200 D. 2,000
Suppose that a company has fixed costs of $11 per unit and variable costs $6 per unit when 11,000 units are produced. What are the fixed costs per unit when 20,000 units are produced?
A product has a sales price of $250 and a per-unit contribution margin of $75. What is the contribution margin ratio?
Klamath Company produces a single product. The projected income statement for the coming year is as follows: Required: 1. Compute the unit contribution margin and the units that must be sold to break even. 2. Suppose 10,000 units are sold above break-even. What is the operating income? 3. Compute the contribution margin ratio. Use the contribution margin ratio to compute the break-even point in sales revenue. (Note: Round the contribution margin ratio to four decimal places, and round the sales revenue to the nearest dollar.) Suppose that revenues are 200,000 more than expected for the coming year. What would the total operating income be?