Principles of Accounting Volume 2
19th Edition
ISBN: 9781947172609
Author: OpenStax
Publisher: OpenStax College
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Textbook Question
Chapter 2, Problem 9EA
The cost data for Evencoat Paint for the year 2019 is as follows:
- Using the high-low method, express the company’s maintenance costs as an equation where x represents the gallons of paint produced. Then estimate the fixed and variable costs.
- Predict the maintenance costs i190,000 gallons of paint are produced.
- Predict the maintenance costs if 81,000 gallons of paint are produced.
- Using Excel, create a scatter graph of the cost data and explain the relationship between gallons of paint produced and equipment maintenance expenses.
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The background info is provided in the image attached. Solve the following:
c) Assuming sales of 5,000 units, prepare a contribution margin income statement for the year ended December 31, 2020, detailing the components of total variable costs and total fixed costs, and clearly showing contribution and net income.
d) Assuming sales of 5,000 units, calculate Buggs-Off break-even point and margin of safety in units andsales dollars.
Two companies Malcom and Yoda manufacture the similar hand-sanitizing products. The following data for the two companies for the year 2019 are provided below:
Malcom ($)
Yoda ($)
Sales revenue
60,000
72000
Total costs
42,000
48000
Variable Costs
40 % of sales revenue
50%
Required:
Calculate the Break Even Point (BEP) in dollars of product for each company.
Calculate the percentage margin of safety for each company.
If sales of the product in Yoda company are equal to 3,000 units, determine the BEP (in units), and present the Break-even chart.
In 2019, company Yoda plans to increase the variable cost by $1 while the fixed cost and the selling price will remain constant. Calculate the number of units to be sold in order to earn the same profit as Malcom in 2019.
Based on your answers to parts 1 and 2, Discuss which company has a safer financial position, and why.
Two companies Malcom and Yoda manufacture the similar hand-sanitizing products. The following data for the two companies for the year 2019 are provided below:
Malcom ($)
Yoda ($)
Sales revenue
60,000
72000
Total costs
42,000
48000
Variable Costs
40 % of sales revenue
50%
Required:
If sales of the product in Yoda company are equal to 3,000 units, determine the BEP (in units), and present the Break-even chart.
In 2019, company Yoda plans to increase the variable cost by $1 while the fixed cost and the selling price will remain constant. Calculate the number of units to be sold in order to earn the same profit as Malcom in 2019.
Based on your answers to parts 1 and 2, Discuss which company has a safer financial position, and why.
I need the answers of the the remaining subparts too all these three points
Chapter 2 Solutions
Principles of Accounting Volume 2
Ch. 2 - Which of the following is the primary source of...Ch. 2 - Which of the following is the primary source of...Ch. 2 - Which of the following is the primary source of...Ch. 2 - Which of the following represents the components...Ch. 2 - Which of the following represents the components...Ch. 2 - Which of the following represents the components...Ch. 2 - Conversion costs include all of the following...Ch. 2 - Which of the following is not considered a product...Ch. 2 - Fixed costs are expenses that...Ch. 2 - Variable costs are expenses that...
Ch. 2 - Total costs for ABC Distributing are $250,000 when...Ch. 2 - Which of the following would not be classified as...Ch. 2 - Which of the following are prime costs? A....Ch. 2 - Which of the following statements is true...Ch. 2 - The high-low method and least-squares regression...Ch. 2 - Which of the following methods of cost estimation...Ch. 2 - In the cost equation Y=a+bx, Y represents which of...Ch. 2 - A scatter graph is used to test the assumption...Ch. 2 - Identify the three primary classifications of...Ch. 2 - Explain how the income statement of a...Ch. 2 - Walsh & Coggins, a professional accounting firm,...Ch. 2 - Lizzys is a retail clothing store, specializing in...Ch. 2 - Identify and describe the three types of product...Ch. 2 - Explain the difference between a period cost and a...Ch. 2 - Explain the concept of relevant range and how it...Ch. 2 - Explain the differences among fixed costs,...Ch. 2 - Explain the difference between prime costs and...Ch. 2 - Explain how a scatter graph is used to identify...Ch. 2 - Explain the components of the total cost equation...Ch. 2 - Explain how the high-low method is used for cost...Ch. 2 - Magio Company manufactures kitchen equipment used...Ch. 2 - Park and West, LLC, provides consulting services...Ch. 2 - Canine Couture is a specialty dog clothing...Ch. 2 - Hicks Contracting collects and analyzes cost data...Ch. 2 - Rose Company has a relevant range of production...Ch. 2 - Carr Company provides human resource consulting...Ch. 2 - Western Trucking operates a fleet of delivery...Ch. 2 - Suppose that a company has fixed costs of $18 per...Ch. 2 - The cost data for Evencoat Paint for the year 2019...Ch. 2 - This cost data from Hickory Furniture is for the...Ch. 2 - Markson and Sons leases a copy machine with terms...Ch. 2 - Markson and Sons leases a copy machine with terms...Ch. 2 - Winterfell Products manufactures electrical...Ch. 2 - CPK ** Associates is a mid-size legal firm,...Ch. 2 - Flip or Flop is a retail shop selling a wide...Ch. 2 - Roper Furniture manufactures office furniture and...Ch. 2 - Baxter Company has a relevant range of production...Ch. 2 - Sanchez & Vukmin, LLP, is a full-service...Ch. 2 - Case Airlines provides charter airline services....Ch. 2 - Suppose that a company has fixed costs of $11 per...Ch. 2 - The cost data for BC Billing Solutions for the...Ch. 2 - This cost data from Hickory Furniture is for the...Ch. 2 - Able Transport operates a tour bus that they lease...Ch. 2 - Able Transport operates a tour bus that they lease...Ch. 2 - Ballentine Manufacturing produces and sells...Ch. 2 - Tom West is a land surveyor who operates a small...Ch. 2 - Just Beachy is a retail business located on the...Ch. 2 - Listed as follows are various costs found in...Ch. 2 - Wachowski Company reported these cost data for the...Ch. 2 - Carolina Yachts builds custom yachts in its...Ch. 2 - Hicks Products produces and sells patio furniture...Ch. 2 - Conner ** Scheer, Attorneys at Law, provide a wide...Ch. 2 - Puzzles, Pranks ** Games is a retail business...Ch. 2 - Pocket Umbrella, Inc. is considering producing a...Ch. 2 - Using the costs listed in the previous problem,...Ch. 2 - Gadell Farms produces venison sausage that is...Ch. 2 - In a team of two or three students, interview the...Ch. 2 - This list contains costs that various...
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