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Managerial Accounting

Autor:   •  October 10, 2017  •  Case Study  •  811 Words (4 Pages)  •  10 Views

Page 1 of 4

Nanuka Ramishvili

Managerial Accouting

Homework Set #1

Exercise #1

Fill in the blanks for each of the following independent cases

Case

Selling price

Variable costs per unit

Total units sold

Total contribution margin

Total fixed costs

Operating profit/loss

a

€30

€20

70 000

€700000

(30-20)*70000

€715000

700000-x=-15000

-€15 000

b

  25

  20

25-x=5

180 000

900 000

800 000

100000

900K-800K

c

  12

x-10=12

  10

150 000

300 000

220 000

80000

d

  20

  14

 20000

120 000

  108000

120K-x=12K

  1. 000

Exercise #6

  A company sells hand-sewn shirts for $25 per unit, and has fixed costs of $7,500.   Their contribution margin ratio is 20%.

a) What is the break-even point in sales dollars?

Breakeven in $= 7500$/0.2 = 37500$

b) How many units do they have to sell to break even?

Breakeven in units = 37500$/25$ = 1500 Units 

c) How much is the variable cost per unit?

25$*20%=5$

25-5=20$  variable cost per unit

e) If the company wishes to earn an operating income of $2,000, how many units need to be sold?

Selling price 25$ and variable cost 20$. Fixed cost 7500;

7500+2000=9500.  9500/(25-20)=1900 units must be sold to reach operating income of 2000

Exercise #9

The summarized profit and loss statement for ABC plc for the last year is as follows;

$ 000

$ 000

Sale (50 000 units)

1000

Direct materials  

350 V

Direct wages  

200 V

Fixed production overhead

200 F

Variable production overhead

50 V

Administration overhead                        

180 F

Selling and distribution overhead

120 F

Total expenses

1100

Profit /(loss)

(100)

At a recent board meeting the directors discussed the year’s results, following which the chairman asked for suggestions to improve the situation.

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