Break even point in unit sales: Break even point is that point of sale units which is required to cover the total costs. Total costs consisting of both fixed and variable costs to the company. BEP is a no profit and no loss situation. BEP can be either in units or sales amount. Requirement-1: The company’s Break-even point in unit sales.

Question

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Answer 1

Question

Chapter 7, Problem 8F15

To determine

Break even point in unit sales:

Break even point is that point of sale units which is required to cover the total costs. Total costs consisting of both fixed and variable costs to the company. BEP is a no profit and no loss situation. BEP can be either in units or sales amount.

Requirement-1:

The company’s Break-even point in unit sales.

To determine

IF BEP unit is below or above the actual unit sales

Break even sales units are above the actual sale units in absorption costing method.

Explanations:

Given:

Actual unit sales is 35,000 units

BEP sales unit is 36,000 units

Formula used:

Actual sales unit- BEP sales units

Calculations:

35,000 units < 36,000 units

Conclusion:

Thus, Break even unit sales is more than the actual sales, in absorption costing method.

Requirement-3:

To determine

Comparing the break-even point in unit sales with that of net operating income under absorption costing.

Expert Solution & Answer

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Answer 2

Question

Chapter 7, Problem 8F15

To determine

Break even point in unit sales:

Break even point is that point of sale units which is required to cover the total costs. Total costs consisting of both fixed and variable costs to the company. BEP is a no profit and no loss situation. BEP can be either in units or sales amount.

Requirement-1:

The company’s Break-even point in unit sales.

To determine

IF BEP unit is below or above the actual unit sales

Break even sales units are above the actual sale units in absorption costing method.

Explanations:

Given:

Actual unit sales is 35,000 units

BEP sales unit is 36,000 units

Formula used:

Actual sales unit- BEP sales units

Calculations:

35,000 units < 36,000 units

Conclusion:

Thus, Break even unit sales is more than the actual sales, in absorption costing method.

Requirement-3:

To determine

Comparing the break-even point in unit sales with that of net operating income under absorption costing.

Expert Solution & Answer

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Check out a sample textbook solution

See solution

Answer 3

Question

Chapter 7, Problem 8F15

To determine

Break even point in unit sales:

Break even point is that point of sale units which is required to cover the total costs. Total costs consisting of both fixed and variable costs to the company. BEP is a no profit and no loss situation. BEP can be either in units or sales amount.

Requirement-1:

The company’s Break-even point in unit sales.

To determine

IF BEP unit is below or above the actual unit sales

Break even sales units are above the actual sale units in absorption costing method.

Explanations:

Given:

Actual unit sales is 35,000 units

BEP sales unit is 36,000 units

Formula used:

Actual sales unit- BEP sales units

Calculations:

35,000 units < 36,000 units

Conclusion:

Thus, Break even unit sales is more than the actual sales, in absorption costing method.

Requirement-3:

To determine

Comparing the break-even point in unit sales with that of net operating income under absorption costing.

Expert Solution & Answer

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Check out a sample textbook solution

See solution

Answer 4

Question

Chapter 7, Problem 8F15

To determine

Break even point in unit sales:

Break even point is that point of sale units which is required to cover the total costs. Total costs consisting of both fixed and variable costs to the company. BEP is a no profit and no loss situation. BEP can be either in units or sales amount.

Requirement-1:

The company’s Break-even point in unit sales.

To determine

IF BEP unit is below or above the actual unit sales

Break even sales units are above the actual sale units in absorption costing method.

Explanations:

Given:

Actual unit sales is 35,000 units

BEP sales unit is 36,000 units

Formula used:

Actual sales unit- BEP sales units

Calculations:

35,000 units < 36,000 units

Conclusion:

Thus, Break even unit sales is more than the actual sales, in absorption costing method.

Requirement-3:

To determine

Comparing the break-even point in unit sales with that of net operating income under absorption costing.

Expert Solution & Answer

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Check out a sample textbook solution

See solution

Answer 5

Chapter 7, Problem 8F15

To determine

Break even point in unit sales:

Break even point is that point of sale units which is required to cover the total costs. Total costs consisting of both fixed and variable costs to the company. BEP is a no profit and no loss situation. BEP can be either in units or sales amount.

Requirement-1:

The company’s Break-even point in unit sales.

To determine

IF BEP unit is below or above the actual unit sales

Break even sales units are above the actual sale units in absorption costing method.

Explanations:

Given:

Actual unit sales is 35,000 units

BEP sales unit is 36,000 units

Formula used:

Actual sales unit- BEP sales units

Calculations:

35,000 units < 36,000 units

Conclusion:

Thus, Break even unit sales is more than the actual sales, in absorption costing method.

Requirement-3:

To determine

Comparing the break-even point in unit sales with that of net operating income under absorption costing.

Answer 6

Chapter 7, Problem 8F15

To determine

Break even point in unit sales:

Break even point is that point of sale units which is required to cover the total costs. Total costs consisting of both fixed and variable costs to the company. BEP is a no profit and no loss situation. BEP can be either in units or sales amount.

Requirement-1:

The company’s Break-even point in unit sales.

Answer 7

Chapter 7, Problem 8F15

To determine

Break even point in unit sales:

Break even point is that point of sale units which is required to cover the total costs. Total costs consisting of both fixed and variable costs to the company. BEP is a no profit and no loss situation. BEP can be either in units or sales amount.

Requirement-1:

The company’s Break-even point in unit sales.

Answer 8

To determine

IF BEP unit is below or above the actual unit sales

Break even sales units are above the actual sale units in absorption costing method.

Explanations:

Given:

Actual unit sales is 35,000 units

BEP sales unit is 36,000 units

Formula used:

Actual sales unit- BEP sales units

Calculations:

35,000 units < 36,000 units

Conclusion:

Thus, Break even unit sales is more than the actual sales, in absorption costing method.

Requirement-3:

Answer 9

To determine

IF BEP unit is below or above the actual unit sales

Break even sales units are above the actual sale units in absorption costing method.

Explanations:

Given:

Actual unit sales is 35,000 units

BEP sales unit is 36,000 units

Formula used:

Actual sales unit- BEP sales units

Calculations:

35,000 units < 36,000 units

Conclusion:

Thus, Break even unit sales is more than the actual sales, in absorption costing method.

Requirement-3:

Answer 10

To determine

Comparing the break-even point in unit sales with that of net operating income under absorption costing.

Answer 11

To determine

Comparing the break-even point in unit sales with that of net operating income under absorption costing.

Answer 12

Expert Solution & Answer

Answer 13

Expert Solution & Answer

Answer 14

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Answer 15

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Solution Summary: The author explains that the company's break-even point in unit sales is 36,000 units under absorption costing method.

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Comparing the break-even point in unit sales with that of net operating income under absorption costing.

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