
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
expand_more
expand_more
format_list_bulleted
Concept explainers
Question
Bear Publishing sells a nature guide. The following information was reported for a typical month:
Total | Per Unit | |||||
Sales | $ | 17,600 | $ | 16.00 | ||
Variable expenses | 9,680 | |||||
Contribution margin | 7,920 | |||||
Fixed expenses | 3,600 | |||||
Net operating income | $ | 4,320 |
What is Bear's current break-even point in unit and dollars? (Round your intermediate calculations to 2 decimal places.)
Expert Solution

This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution
Trending nowThis is a popular solution!
Step by stepSolved in 2 steps with 1 images

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
- Menlo Company distributes a single product. The company’s sales and expenses for last month follow: Total Per Unit Sales $ 616,000 $ 40 Variable expenses 431,200 28 Contribution margin 184,800 $ 12 Fixed expenses 151,200 Net operating income $ 33,600 Required: 1. What is the monthly break-even point in unit sales and in dollar sales? 2. Without resorting to computations, what is the total contribution margin at the break-even point? 3-a. How many units would have to be sold each month to attain a target profit of $62,400? 3-b. Verify your answer by preparing a contribution format income statement at the target sales level. 4. Refer to the original data. Compute the company's margin of safety in both dollar and percentage terms. 5. What is the company’s CM ratio? If the company can sell more units thereby increasing sales by $76,000 per month and there is no change in fixed expenses, by how much would you expect monthly net operating income to increase?arrow_forwardAssume that a company provided the following cost formulas for three of its expenses (where qrefers to the number of hours worked): Rent (fixed) Supplies (variable) Utilities (mixed) $ 3,000 $ 4.00q $150 + $0.75q The company's planned level of activity was 2,000 hours and its actual level of activity was 1,900 hours. The actual amount of utilities expense for the period was $1,700. What is th spending variance for utilities expense?arrow_forwardJake's Roof Repair has provided the following data concerning its costs: Wages and salaries Parts and supplies Fixed Cost per Month $20,600 Cost per Repair-Hour $15.00 $ 7.30 Equipment depreciation $ 2,750 $ 0.35 Truck operating expenses $ 5,710 $ 1.70 Rent $ 4,670 Administrative expenses $ 3,820 $ 0.50 For example, wages and salaries should be $20,600 plus $15.00 per repair-hour. The company expected to work 3,000 repair-hours in May, but actually worked 2,900 repair-hours. The company expects its sales to be $49.00 per repair-hour. Required: Compute the company's activity variances for May. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) Jake's Roof Repair Activity Variances For the Month Ended May 31 Revenue Expenses: Wages and salaries Parts and supplies Equipment depreciation Truck operating expenses Rent Administrative expenses Total expense Net…arrow_forward
- Clay Earth Company sells ceramic pottery at a wholesale price of $4.00per unit. The variable cost of manufacturing is $1.25 per unit. The fixed costs are $6,800 per month. It sold 5,500 units during this month. Calculate Clay Earth's operating income (loss) for this month. A.$ 8 comma 325 $8,325 B. $(6,800) C. $(8,325) D.$ 15 comma 200arrow_forwardPublix sold 1,000 units last month which yielded the income statement below. Sales $20,000 Variable Expenses 12,000 Contribution Margin 8,000 Fixed Expenses 6,000 $2,000 Net Income Answer the questions that follow using the given information. 1. What is Publix's contribution margin per unit? 2. What is the contribution margin ratio? 3. What is the break-even point in units? 4. What is the break-even point in dollars? 5. How many units have to be sold to reach a target profit of $5,000?arrow_forwardDietrick Corporation produces and sells two products. Data concerning those products for the most recent month appear below: Product B32L $ 46,000 Sales $ 27,000 Variable expenses $ 13,800 $ 14,670 Fixed expenses for the entire company were $42,550. The break-even point for the entire company is closest to: Note: Round your intermediate calculations to 2 decimal places. Product K84Barrow_forward
- Whirly Corporation's contribution format income statement for the most recent month is shown below: Total Per Unit Sales (7,700 units) $ 246, 400 $ 32.00 Variable expenses 138, 600 18.00 Contribution margin 107,800 $ 14.00 Fixed expenses 54, 500 Net operating income $ 53,300 Required: (Consider each case independently): What would be the revised net operating income per month if the sales volume increases by 60 units? What would be the revised net operating income per month if the sales volume decreases by 60 units? What would be the revised net operating income per month if the sales volume is 6, 700 units?arrow_forwardCullumber Industries produces and sells a cell phone-operated home security control systems. Information regarding the costs and sales during May 2022 is as follows. Unit selling price Unit variable costs Total monthly fixed costs Units sold Prepare a CVP income statement for Cullumber Industries for the month of May. (Round per unit answers to 2 decimal places, e.g. 15.25.) Cullumber Industries CVP Income Statement For the Month Ended May 31, 2022 Sales Variable Costs Contribution Margin Fixed Costs $55.00 $31.35 $128,000 7,800 Net Income/(Loss) S Total SA Per Unit 8400 Percent of Sales searrow_forwardDetermine the monthly break-even in total dollar sales.arrow_forward
- Evansville Company had the following transactions for the month. Number Cost of Units per Unit Purchase $8,000 Purchase 6 9,000 Purchase 9,500 Calculate the gross margin for each of the following cost allocation methods, assuming Evansville sold just one unit of these goods for $10,000. Round your intermediate calculations and final answers to the nearest dollar amount. Gross Margin A. First-in, First-out (FIFO) B. Last-in, First-out (LIFO) C. Weighted Average (AVG) When prices are rising (inflation), which costing method would produce the highest value for gross margin?arrow_forwardMiller Company's contribution format income statement for the most recent month is shown below: Total Per Unit Sales (25, 800 units) $ 232,200 $ 9.00 Variable expenses 139,320 5.40 Contribution margin 92,880 $ 3.60 Fixed expenses 54,180 Net operating income $ 38,700 Required: (Consider each of the four requirements independently): Assume the sales volume increases by 4, 128 units: What is the revised net operating income? What is the percent increase in unit sales? Using the most recent month's degree of operating leverage, what is the percent increase in net operating income? What is the revised net operating income if the selling price decreases by $1.50 per unit and the number of units sold increases by 23 % ? What is the revised net operating income if the selling price increases by $1.50 per unit, fixed expenses increase by $6,000, and the number of units sold decreases by 7 % ? What is the revised net operating income if the selling price per unit increases by 20%, variable…arrow_forwardFollowing is relevant information for Philly's Sandwich Shop, a small business that serves sandwiches: Total fixed cost per month Variable cost per sandwich $1,020.00 1.50 Sales price per sandwich 5.75 During the month of June, Philly's sold 580 sandwiches. Required: Complete the contribution margin income statement for the month of June. Note: Round your final answers to the nearest whole dollar. Philly's Sandwich Shop Contribution Margin Income Statement Month of June Contribution margin Net Operating incomearrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
- Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSONIntermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill EducationFinancial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education


Accounting
Accounting
ISBN:9781337272094
Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:Cengage Learning,

Accounting Information Systems
Accounting
ISBN:9781337619202
Author:Hall, James A.
Publisher:Cengage Learning,

Horngren's Cost Accounting: A Managerial Emphasis...
Accounting
ISBN:9780134475585
Author:Srikant M. Datar, Madhav V. Rajan
Publisher:PEARSON

Intermediate Accounting
Accounting
ISBN:9781259722660
Author:J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:McGraw-Hill Education

Financial and Managerial Accounting
Accounting
ISBN:9781259726705
Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:McGraw-Hill Education