Executives of Studio Recordings Inc. produced the lat-est compact disc by the Starshine Sisters Band, titledSunshine/Moonshine. The following cost informationpertains to the CD.a. CD packageb. Songwriters' royaltiesc. Recording artists' royaltiesd. Advertising and promotion$1.25/CD$0.35/CD$1.00/CD$275,000e. Studio Recording Inc.'s overheadf. Selling price to the CD distributor$250,000$9.00Calculate the following:1. Contribution per CD unit2. Break-even volume in CD units and dollars3. Net profit if 1 million CDs are sold4. Necessary CD unit volume to achieve a $200,000profit

The break even sales are the sales where business earns no profit no loss during the period.

Answered: Executives of Studio Recordings Inc.…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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executives of Studio Recordings Inc. produced the latest compact disc by the Starshine Sisters Band, titledSunshine/Moonshine. The following cost informationpertains to the CD.a. CD package $1.25/CDb. Songwriters’ royalties $0.35/CDc. Recording artists’ royalties $1.00/CDd. Advertising and promotion $275,000e. Studio Recording Inc.’s overhead $250,000f. Selling price to the CD distributor $9.00Calculate the following:1. Contribution per CD unit2. Break-even volume in CD units and dollars3. Net profit if 1 million CDs are sold4. Necessary CD unit volume to achieve a $200,000profit
The following cost information pertains to the new CD: CD package and disc (direct material and labor): $2.50/CD Songwriters’ royalties: $0.70/CD Recording Artists’ royalties: $2.00/CD Advertising & promotion: $380,000 Sony Records Inc.’s Overhead: $300,000 Selling price of CD: $10.00 Question 2: If they sold 100,000 CDs and decided they wanted to invest in a $75,000 advertising campaign in the hopes of generating more sales, how many more CDs would they have to sell to maintain their current contribution to the organization? Group of answer choices a 75,000 b None of these c 15,625 d 92,500
SWA company is trying find costs of its products. Which of the following statements is true? A cost is: a. Always an expense. b. Always an asset. c. Something quite different from either an expense or an asset. d. Can be either an expense or an asset. e. Always a liability. MS Harius is an accounting in Lata company; the company has leased a copying machine on a monthly basis which is on a fixed fee each month in addition to a charge per copy. Technical made 2,400 copies and paid a total of $162 in rent in September and in October they paid $195 for 3,500 copies Determine the total amount that would be paid for 1,800 copies. a. Some other amount not listed here b. $138 c. $144 d. $160 e. $163
The trial balance of Esplanade Company showed inventories of P164,000. The inventories include some goods that have a production cost of P18,000. These goods have a manufacturing defect that will cost P6,000 to correct. The normal selling price for these goods would be P25,000, but after the remedial work they will be sold through an agent as refurbished goods at a discount of 20% on the normal selling price. The agent will receive a commission of 10% of the reduced selling price. In relation to the defective goods, the company will recognize a loss on inventory write down of
The trial balance of Magic Shop Company showed inventories of P164,000. The inventories include some goods that have a production cost of P18,000. These goods have a manufacturing defect that will cost P6,000 to correct. The normal selling price for these goods would be P25,000, but after the remedial work they will be sold through an agent as refurbished goods at a discount of 20% on the normal selling price. The agent will receive a commission of 10% of the reduced selling price. In relation to the defective goods, the company will recognize a loss on inventory write down of? A. P4,000 B. P0 C. P1,000 D. P6,000
(a) Burnem, Inc. manufactures blank CDs and sells them to a distributor in packs of 500 CDs. Burnem’s total cost and total revenue (in dollars) for x packs of 500 CDs are given by Total Cost= 2x+ 7920 and Total Revenue = 20x How many packs of 500 CDs must Burnem sell to breakeven?
Harris Ltd also recently imported an artificial intelligent machinery and incurred the following costs: $List price (trade discount 12.5% on list price) 480,000Haulage costs 5,500Pre-production testing of machinery 25,000Repair & maintenance contract for three years 48,000Running of electrical cable for machinery 28,000Special foundation for mounting machinery 9,000Labor costs (direct) 15,000Harris Ltd paid for the machinery within four weeks of the order, therefore, obtained an early settlement discount of 3%.Harris Ltd had wrongly specified the power loading of the original…
A distributor of artistic iron-based fixtures acquires a piece for $1,000, terms FOB shipping point. Additional costs in obtaining it and offering it for sale include $150 for transportation-in, $300 for import duties, $100 for insurance during shipment, $200 for advertising, a $50 voluntary gratuity to the delivery person, $75 for enhanced store lighting, and $250 for sales staff salaries. For computing inventory, what cost is assigned to this artistic piece?
A towel is offered as a premium to customers who send in 10box tops of facial soap returned and a remittance of ₱25. Distribution cost is ₱10 per towel. The entityestimated that only 60% of the box tops reaching the market will be redeemed. The entity provided thefollowing information: 2020 2021Facial soap sales, ₱50 per unit ₱ 2,500,000 ₱ 2,875,000Towel purchases, ₱90 per unit ₱ 337,500 ₱ 360,000Number of box tops returned 22,500 38,550Requirements:4. Compute for the premiums (as an asset) amount for the year ended:A. December 31, 2020B. December 31, 2021
Atlantis Company is placing an ad in the local paper to advertise its products. The ad will run for one week at a total cost of P5, 500. Atlantis Company has four categories of products as follows: Product category % of floor space occupied Expected sales value A 20 P35,000 B 15 15,000 C 45 64,500 D 20 25,500 What amount of advertising cost should be allocated to product category A, B, C, and D assuming Atlantis allocates based on percent of floor space occupied?
Gloden Company operates a retail store in Faith, Hope, and Love. Golden Company’s corporate headquarters is located in Manila, and the company uses responsibility accounting to evaluate performance. The following information relates to the Faith facility:· The store sold 100,000 units at P20.00 each, after having purchased the units from various suppliers for P13. Faith salespeople are paid a 10% commission based on gross sales pesos.· Faith’s sales manager oversees the placement of local advertising contracts, which cost P88,000 and 5% of gross sales pesos. Local property taxes amounted to P15,000.· The sales manager’s P95,000 salary is set by Faith’s store manager. In contrast, the store manager’s P120,000 salary is determined by National Company’s vice president.· Faith incurred P20,000 of other noncontrollable costs along with P10,000 of income tax expense.· Nontraceable (common) corporate overhead totaled P68,000.The income that will be used to evaluate the manager of Faith…
Philacor, Inc. consigned twelve refrigerators to Ocampo’s Emporium. The refrigerators cost P6,000 each and the consignor paid P720 for freight-out. The consignee rendered an account sales for the five units sold at P7,700 each, and deducted the following items from the selling price: Commission (based on sales net of commission) 10% Marketing expense (based on commission) 10% Delivery and installation (on each unit sold) P30 How much was the net profit of the consignor on the five refrigerators sold? How much was the net remittance of the consignee on the five refrigerators sold?

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