Example 14: CVP Analysis Application: For example, sale price of one laptop is $500, sales revenue=500Q; Assume that expense is Y=a+bx=$80,000+300Q. We can draw two lines to assume Horizontal line (X) is the units sold Q and Vertical line (Y) is dollar sales $. We need to draw a graph using this information
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Example 14: CVP Analysis Application:
For example, sale price of one laptop is $500, sales revenue=500Q;
Assume that expense is Y=a+bx=$80,000+300Q. We can draw two lines to assume Horizontal line (X) is the units sold Q and Vertical line (Y) is dollar sales $.
We need to draw a graph using this information
Step by step
Solved in 2 steps with 1 images
- Refer to Cornerstone Exercise 3.4 for data on Dohini Manufacturing Companys purchasing cost and number of purchase orders. The controller for Dohini Manufacturing ran regression on the data, and the coefficients shown by the regression program are: Required: 1. Construct the cost formula for the purchasing activity showing the fixed cost and the variable rate. 2. If Dohini Manufacturing Company estimates that next month will have 430 purchase orders, what is the total estimated purchasing cost for that month? (Round your answer to the nearest dollar.) 3. What if Dohini Manufacturing wants to estimate purchasing cost for the coming year and expects 5,340 purchase orders? What will estimated total purchasing cost be? (Round your answer to the nearest dollar.) What is the total fixed purchasing cost? Why doesnt it equal the fixed cost calculated in Requirement 1?5.An account executive receives a base salary plus a commission. On $30,000 in monthly sales, an account executive would receive compensation of $3100. On $50,000 in monthly sales, an account executive would receive compensation of $4300. Determine a linear function that yields the compensation y of a sales executive for a given amount of monthly sales x(. )? Use this model to determine the compensation of an account executive who has $85,000 in monthly sales. $ ? 6.A manufacturer of graphing calculators has determined that 8,000 calculators per week will be sold at a price of $85 per calculator. At a price of $80, it is estimated that 12,000 calculators will be sold. Determine a linear function that predicts the number of calculators that will be sold per week at a price of x dollars.y = Use this model to predict the number of calculators that will be sold at a price of $75.(. )?calculatorsSuppose a ceiling fan manufacturer has the total cost function C(x) = 35x + 1200 and the total revenue function R(x) = 65x. (a) What is the equation of the profit function P(x) for this commodity? P(x) = (b) What is the profit on 20 units? P(20) = Interpret your result. The total costs are less than the revenue. The total costs are more than the revenue. The total costs are exactly the same as the revenue. (c) How many fans must be sold to avoid losing money? fans
- Give typing answer with explanation and conclusion Item is canyon scanner sales prices $85 markup percent is 25%, what is the dollar markup and cost?Refer to Cornerstone Exercise 3.4 for data on Dohini Manufacturing Company’s purchasing cost and number of purchase orders.The controller for Dohini Manufacturing ran regression on the data, and the coefficients shown by the regression program are: Intercept 15,021 (rounded to the nearest dollar)X variable 1 9.74 (rounded to the nearest cent) Required: 1. Construct the cost formula for the purchasing activity showing the fixed cost and the vari-able rate. 2. If Dohini Manufacturing Company estimates that next month will have 430 purchaseorders, what is the total estimated purchasing cost for that month? (Round your answer tothe nearest dollar.)3. What if Dohini Manufacturing wants to estimate purchasing cost for the coming year andexpects 5,340 purchase orders? What will estimated total purchasing cost be? (Round youranswer to the nearest dollar.) What is the total fixed purchasing cost? Why doesn’t it equalthe fixed cost calculated in Requirement 1?Qs Let the selling Price of a product is 200$ and the variable cost is 120$ and the Fixed Cost is 120008 find: . Quantity of Break Even Point. . Break Even Point Revenues in dollar. . The number of product if the operating profitis 24000 a b. c d. The sale value if the expected profit 8000$. = 5=
- a company manufactures computers . The variable cost of producing a computer is 2 TL and the fixed cost is 3TL.The demand equation for this product is p=8-lnx. Here X: shows the number of computers , p: shows the price of a computer. How Much Should a computer be sold for to make a maximum profit A)1 B)10 C)2 D)5 E)3Consider the following information for a given business. Sale revenue =GHS40,000 VC per unit =GHS20 Activity level =1,000 to break even Required: 1. Determine the TFC 2. Express the contribution as a percentage of sale. 3. The company plans to sale 1,500 unit in the next period. What will be the percentage margin of safety (MoS) 4. What margin should the business employ for planning purposes? 5. What total profit should the business expect in order to achieve it's planned sales?Assume that the linear cost and revenue models apply. An item costs $12 to make. If fixed costs are $3000 and profits are $5000 when 100 items are made and sold, find the revenue equation. (Let x be the number of items.)R(x) =
- 1. Now change all of the dollar amounts in the data area of your worksheet so that it looks like this: Chapter 1: Applying Excel Data Sales $59,500 Variable costs: Cost of goods sold $34,000 Variable selling $3,400 Variable administrative $3,200 Fixed costs: Fixed selling $2,500 Fixed administrative $1,500 If your formulas are correct, you should get the correct answers to the following questions. (a) What is the gross margin now? (b) What is the net operating income now? (c) What is the contribution margin now?A small company manufactures a certain item and sells it online. The company has a business model where the cost, C in dollars, to make x items is given by the equation C = 20/3 x + 50. The revenue R , in dollars , made by selling x items is given by the equation R = 10x. How many items must the company sell in order for the cost to equal their revenue?Given the following, solve the independent questions using the CVP analysis. Selling Price = 30 Variable Cost per Unit = 20 Total Fixed Cost = 60,000REQUIRED: 1 Find the following functions: • Total Revenue = [TR] • Total Variable Cost = [TVC] • Total Cost = [TC] • Total Profit = [TP] 2 What is the volume of production for the business firm not to incur any profit nor loss? 3 At zero quantity of production, how much is the total cost? 4 What is the volume of production if the company wants to earn 100,000 profit?