NU Mikaela OBrien f y Question 2 Correct 100 points out of 1

NU Mikaela O\'Brien f y Question 2 Correct 1.00 points out of 1.00 P Flag question Assume a company sells a given product for $75 per unit. How many units must be sold to break-even if variable selling costs are fixed costs are $700,000? Select one: $12 per unit, variable production costs are $23 per unit, and total ting inclu overhead a. 11,112 units b. 13.462 units. c. 9.334 units. d. 17.500 units. v e. 6,363 units. ting incluc overhead a uring over st in variabl inistrative st in either a as they are Ouestion 3 Incorrect 0.00 points out of 1.00 P Flag question Assume a conpany sells a given product for $90 per unit. How many units must be sold to break-even if variable selling costs are $2 per unit, variable production costs are $31 per unit, and total fixed costs are $1,799,946 Select one: a. 31,578 units. b. 19.995 units c. 20,454 units. d. 14,634 units. X e. 899.973 units O EI

Solution

3) Break-even point (units) = Fixed cost / contribution per unit

Contribution per unit = Selling price per unit – Variable cost per unit = 90-(31+2) = 57

Break-even point (units) = 1799946/57 = 31578 units (Option A)

6) Manufacturing Margin = Sales – production Variable cost

Sales = 300*43000 =12900000 (Sales per unit * Total Units)

Production Variable cost = 168*43000 = 7224000

Manufacturing Margin = 12900000-7224000 = 5676000 (Option b )

11) Production cost per unit = Direct Labour cost per unit+ Direct Material cost per unit + Variable Overhead cost per unit + Fixed Overhead cost per unit

=8.40+9+6.75+2 = 26.15 (Option b)

(Calculation for Fixed Overhead cost per unit = 60000/30000 = 2)

16) Under absorption costing method cost includes Direct Material, Direct Labour, Variable and fixed Manufacturing overhead. Cost component does not include Variable and Fixed Selling and Administrative overhead because inventory can get unsold.

Option C is the correct answer Direct Labour, Direct Material, Variable and fixed manufacturing overhead

17) Under variable costing method only variable cost are included.

Hence Option B - Direct Labour, Direct Material, Variable manufacturing overhead