125. Boenisch Corporation produces and sells a single product with the following
characteristics:
Per Unit Percent of Sales
Selling price $170 100%
Variable expenses 102 60%
Contribution margin $68 40%
The company is currently selling 8,000 units per month. Fixed expenses are $406,000 per month.
Consider each of the following questions independently.
This question is to be considered independently of all other questions relating to Boenisch
Corporation. Refer to the original data when answering this question.
The marketing manager believes that a $10,000 increase in the monthly advertising budget
would result in a 170 unit increase in monthly sales. What should be the overall effect on the
company’s monthly net operating income of this change?
126. Boenisch Corporation produces and sells a single product with the following
characteristics:
Per Unit Percent of Sales
Selling price $170 100%
Variable expenses 102 60%
Contribution margin $68 40%
The company is currently selling 8,000 units per month. Fixed expenses are $406,000 per month.
Consider each of the following questions independently.
This question is to be considered independently of all other questions relating to Boenisch
Corporation. Refer to the original data when answering this question.
The marketing manager would like to cut the selling price by $12 and increase the advertising
budget by $30,000 per month. The marketing manager predicts that these two changes would
increase monthly sales by 1,800 units. What should be the overall effect on the company’s
monthly net operating income of this change?
127. Boenisch Corporation produces and sells a single product with the following
characteristics:
Per Unit Percent of Sales
Selling price $170 100%
Variable expenses 102 60%
Contribution margin $68 40%
The company is currently selling 8,000 units per month. Fixed expenses are $406,000 per month.
Consider each of the following questions independently.
This question is to be considered independently of all other questions relating to Boenisch
Corporation. Refer to the original data when answering this question.
The marketing manager would like to introduce sales commissions as an incentive for the sales
staff. The marketing manager has proposed a commission of $16 per unit. In exchange, the sales
staff would accept a decrease in their salaries of $102,000 per month. (This is the company’s
savings for the entire sales staff.) The marketing manager predicts that introducing this sales
incentive would increase monthly sales by 700 units. What should be the overall effect on the
company’s monthly net operating income of this change?
128. Smee Inc. produces and sells a single product. The selling price of the product is $130.00
per unit and its variable cost is $52.00 per unit. The fixed expense is $281,580 per month.
The break-even in monthly unit sales is closest to:
129. Smee Inc. produces and sells a single product. The selling price of the product is $130.00
per unit and its variable cost is $52.00 per unit. The fixed expense is $281,580 per month.
The break-even in monthly dollar sales is closest to:
130. Blackner Corporation produces and sells a single product. Data concerning that product
appear below:
Selling price per unit $220.00
Variable expense per unit $70.40
Fixed expense per month $492,184
The break-even in monthly unit sales is closest to:
131. Blackner Corporation produces and sells a single product. Data concerning that product
appear below:
Selling price per unit $220.00
Variable expense per unit $70.40
Fixed expense per month $492,184
The break-even in monthly dollar sales is closest to:
132. Data concerning Kuralt Corporation’s single product appear below:
Selling price per unit $220.00
Variable expense per unit$57.20
Fixed expense per month $310,948
The break-even in monthly unit sales is closest to:
133. Data concerning Kuralt Corporation’s single product appear below:
Selling price per unit $220.00
Variable expense per unit$57.20
Fixed expense per month $310,948
The break-even in monthly dollar sales is closest to:
134. Moccio Enterprises, Inc., produces and sells a single product whose selling price is
$120.00 per unit and whose variable expense is $37.20 per unit. The company’s monthly fixed
expense is $356,040.
Assume the company’s target profit is $14,000. The unit sales to attain that target profit is
closest to:
135. Moccio Enterprises, Inc., produces and sells a single product whose selling price is
$120.00 per unit and whose variable expense is $37.20 per unit. The company’s monthly fixed
expense is $356,040.
Assume the company’s target profit is $15,000. The dollar sales to attain that target profit is
closest to:
136. Data concerning Matsumoto Corporation’s single product appear below:
Selling price per unit $130.00
Variable expense per unit$52.00
Fixed expense per month $280,800
Assume the company’s target profit is $5,000. The unit sales to attain that target profit is closest
to:
137. Data concerning Matsumoto Corporation’s single product appear below:
Selling price per unit $130.00
Variable expense per unit$52.00
Fixed expense per month $280,800
Assume the company’s target profit is $8,000. The dollar sales to attain that target profit is
closest to:
138. Upchurch Corporation produces and sells a single product. Data concerning that product
appear below:
Selling price per unit $100.00
Variable expense per unit$34.00
Fixed expense per month $312,180
Assume the company’s target profit is $12,000. The unit sales to attain that target profit is
closest to:
139. Upchurch Corporation produces and sells a single product. Data concerning that product
appear below:
Selling price per unit $100.00
Variable expense per unit$34.00
Fixed expense per month $312,180
Assume the company’s target profit is $14,000. The dollar sales to attain that target profit is
closest to:
140. Callicott Corporation produces a product that sells for $120 per unit. The product’s
current sales are 25,400 units and its break-even sales are 18,542 units.
What is the margin of safety in dollars?
141. Callicott Corporation produces a product that sells for $120 per unit. The product’s
current sales are 25,400 units and its break-even sales are 18,542 units.
The margin of safety as a percentage of sales is closest to:
142. Mcallister Corporation has provided the following data concerning its only product:
Selling price $150 per unit
Current sales 39,900 units
Break-even sales 31,521 units
What is the margin of safety in dollars?