Accounting Chapter 19 Homework Sales Variable Costs Fixed Costs Total Costs

subject Type Homework Help
subject Pages 10
subject Words 1626
subject Authors Carl S. Warren, James M. Reeve, Jonathan Duchac

Unlock document.

This document is partially blurred.
Unlock all pages and 1 million more documents.
Get Access
page-pf1
CHAPTER 19 Cost Behavior and Cost-Volume-Profit Analysis
Prob. 19–2A (FIN MAN); Prob. 4–2A (MAN)
1. Variable Variable
Total Cost Cost Percentage Cost
Cost of goods sold………………
$6,000,000 × 80% = $4,800,000
2. Total Number
Amount of Units Per Unit
Net sales……………………………
$17,400,000
÷
150,000 = $116.00
6. Sales ($17,400,000 + $3,625,000)………………………
7. Present operating income………………………………
=
Fixed Costs + Target Profit
Unit Contribution Margin
3. Fixed Costs
Unit Contribution Margin
Break-Even
Sales (units) =
5.
$21,025,000
4. Break-Even
Sales (units) =Fixed Costs
Unit Contribution Margin
Sales (units)
$4,400,000
page-pf2
CHAPTER 19 Cost Behavior and Cost-Volume-Profit Analysis
Prob. 19–2A (FIN MAN); Prob. 4–2A (MAN) (Concluded)
8. In favor of the proposal is the possibility of increasing income from operations
from $4,400,000 to $4,962,500. However, there are many points against the
proposal, including:
a. The break-even point increases by 20,000 units (from 62,000 to 82,000).
page-pf3
CHAPTER 19 Cost Behavior and Cost-Volume-Profit Analysis
Prob. 19–3A (FIN MAN); Prob. 4–3A (MAN)
Break-Even
Sales (units)
$480,000
$40*
3.
4. Sales (16,000 × $100)…………………… $1,600,000
Total fixed costs………………………… $480,000
Total variable costs (16,000 × $60)…
960,000 1,440,000
Income from operations………………
$ 160,000
Total Fixed Costs
Unit Selling Price – Unit Variable Cost
= 12,000 units
1. = Total Fixed Costs
Unit Contribution Margin
=
=
$1,500,000
$2,000,000
Sales
Total Costs
Operating Profit Area
Break-Even Point
page-pf4
CHAPTER 19 Cost Behavior and Cost-Volume-Profit Analysis
Prob. 19–4A (FIN MAN); Prob. 4–4A (MAN)
1.
$600,000
$700,000
Operating
Profit Area
page-pf5
CHAPTER 19 Cost Behavior and Cost-Volume-Profit Analysis
Prob. 19–4A (FIN MAN); Prob. 4–4A (MAN) (Continued)
1. Break-Even Units:
Break-Even Sales (units) = Total Fixed Costs =Total Fixed Costs
Unit Contribution Margin Unit Selling Price – Unit Variable Cost
$250 Unit Selling Price – $175 Unit Variable Cost
=$75,000 = 1,000 units
page-pf6
CHAPTER 19 Cost Behavior and Cost-Volume-Profit Analysis
Prob. 19–4A (FIN MAN); Prob. 4–4A (MAN) (Continued)
2.
Units sold: $500,000 ÷ $250 per unit = 2,000 units
a. b.
2,000 units 2,500 units
Sales………………………………………………………………
$500,000 $625,000
$0
$100,000
$600,000
0 500 1,000 1,500 2,000 2,500
Units of Sales
Operating
Profit Area
Break-Even
Point
Operating Loss
Area
$625,000
$75,000
page-pf7
CHAPTER 19 Cost Behavior and Cost-Volume-Profit Analysis
Prob. 19–4A (FIN MAN); Prob. 4–4A (MAN) (Continued)
3.
$600,000
$700,000
Operating
Profit Area
page-pf8
CHAPTER 19 Cost Behavior and Cost-Volume-Profit Analysis
Prob. 19–4A (FIN MAN); Prob. 4–4A (MAN) (Continued)
3. Break-Even Units:
Break-Even Sales (units) = Total Fixed Costs =Total Fixed Costs
Unit Contribution Margin Unit Selling Price – Unit Variable Cost
page-pf9
CHAPTER 19 Cost Behavior and Cost-Volume-Profit Analysis
Prob. 19–4A (FIN MAN); Prob. 4–4A (MAN) (Concluded)
4.
a. b.
2,000 units 2,500 units
Sales………………………………………………………………
$500,000 $625,000
$0
$100,000
$200,000
$700,000
0 500 1,000 1,500 2,000 2,500
Sales and Costs
Units of Sales
Operating
Profit Area
Break-Even
Point
Operating
Loss Area
$108,750
page-pfa
CHAPTER 19 Cost Behavior and Cost-Volume-Profit Analysis
Prob. 19–5A (FIN MAN); Prob. 4–5A (MAN)
(Overall product is labeled E.)
2. 4,030 units of E × 40% = 1,612 units of laptops
4,030 units of E × 60% = 2,418 units of tablets
3. Unit selling price of E [($1,600 × 50%) + ($850 × 50%)]…………………………
$1,225
page-pfb
CHAPTER 19 Cost Behavior and Cost-Volume-Profit Analysis
Prob. 19–6A (FIN MAN); Prob. 4–6A (MAN)
1.
Sales (21,875 × $160) $3,500,000
Cost of goods sold:
Direct materials (21,875 × $46) $1,006,250
Direct labor (21,875 × $40) 875,000
Factory overhead [$200,000 + (21,875 × $20)] 637,500
Cost of goods sold 2,518,750
Gross profit $ 981,250
Expenses:
WOLSEY INDUSTRIES INC.
Estimated Income Statement
For the Year Ended December 31, 2016
page-pfc
CHAPTER 19 Cost Behavior and Cost-Volume-Profit Analysis
Prob. 19–6A (FIN MAN); Prob. 4–6A (MAN) (Continued)
$525,000
$160 – $120
13,125 units
$3,500,000
=$3,500,000 – (21,875 × $120)
3. Break-Even Sales (units)
==
=Fixed Costs
Unit Contribution Margin
2. Contribution Margin Ratio = Sales – Variable Costs
Sales
page-pfd
CHAPTER 19 Cost Behavior and Cost-Volume-Profit Analysis
Prob. 19–6A (FIN MAN); Prob. 4–6A (MAN) (Concluded)
4.
5. Margin of safety:
In dollars:
Expected sales (21,875 × $160)………………………………
$3,500,000
Break-even point (13,125 × $160)……………………………
2,100,000
Margin of safety…………………………………………………
$1,400,000
6. Operating Leverage =
Income from Operations
Contribution Margin
$3,500,000
$4,000,000
$4,500,000
Units
Operating Profit
Area
Break-Even Point
page-pfe
CHAPTER 19 Cost Behavior and Cost-Volume-Profit Analysis
Prob. 19–1B (FIN MAN); Prob. 4–1B (MAN)
Fixed Variable Mixed
Cost Cost Cost Cost
a. X
b. X
c. X
d. X
page-pff
CHAPTER 19 Cost Behavior and Cost-Volume-Profit Analysis
Prob. 19–2B (FIN MAN); Prob. 4–2B (MAN)
1. Total Variable Cost Variable
Cost Percentage Cost
Cost of goods sold…………………………
$1,400,000 × 75% = $1,050,000
2. Number
Total Amount of Units Per Unit
$20 per unit
6. Sales ($2,880,000 + $900,000)………………………………
7. Present operating income……………………………………
$3,780,000
Fixed Costs + Target Profit
4. Break-Even
Sales (units) =
$20 per unit
Fixed Costs
Unit Contribution Margin
5. Unit Contribution Margin
Break-Even
Sales (units)
$692,500
Sales (units)
=
3.
=Fixed Costs
Unit Contribution Margin
page-pf10
CHAPTER 19 Cost Behavior and Cost-Volume-Profit Analysis
Prob. 19–2B (FIN MAN); Prob. 4–2B (MAN) (Concluded)
8. In favor of the proposal is the possibility of increasing income from operations
from $692,500 to $880,000. However, there are many points against the
proposal, including:

Trusted by Thousands of
Students

Here are what students say about us.

Copyright ©2022 All rights reserved. | CoursePaper is not sponsored or endorsed by any college or university.