ACCT-526: Final
QUESTIONS AND VERIFIED
CORRECT ANSWERS
GRADED A+ LATEST 100%
GUARANTEED PASS
If price is $10, unit variable cost is $2.50, and total fixed cost is 3,000, the unit contribution
margin is $7.50. T/F - CORRECT ANSWER-TRUE
The breakeven in sales dollars equation is total fixed expenses divided by the contribution
margin ratio. T/F - CORRECT ANSWER-TRUE
Tacos-2-Go could reduce their variable costs by shopping at wholesale supplies over local
groceries. T/F - CORRECT ANSWER-TRUE
Total fixed costs, price, and unit variable costs all have an impact on the breakeven point. T/F -
CORRECT ANSWER-TRUE
Graphically, the breakeven point is where the contribution margin crosses the fixed cost line. T/F
- CORRECT ANSWER-TRUE
If the gym's monthly unlimited plan cost $100 and the daily plan cost $12, Lacy would need to
go to the gym at least 10 times per month for the monthly plan to be the better deal. T/F -
CORRECT ANSWER-FALSE
,If the gym's monthly unlimited plan cost $50 and the daily plan cost $8, Lacy should use the
daily plan if she only intends to go to the gym 6 times per month. T/F - CORRECT ANSWER-TRUE
CHAPTER 7- HW - CORRECT ANSWER-
Head-First Company plans to sell 5,200 bicycle helmets at $73 each in the coming year. Unit
variable cost is $47 (includes direct materials, direct labor, variable factory overhead, and
variable selling expense). Total fixed cost equals $49,300 (includes fixed factory overhead and
fixed selling and administrative expense).
Calculate the number of helmets Head-First must sell to earn operating income of $66,140. -
CORRECT ANSWER-4440
($49,300 + $66,140) ÷ ($73 − $47) = 4,440
*Break-even units = (Total fixed cost + Target income)/ Unit contribution margin
Head-First Company plans to sell 5,800 bicycle helmets at $67 each in the coming year. Product
costs include:
Direct materials per helmet $29
Direct labor per helmet 11.00
Variable factory overhead per helmet 4.25
Total fixed factory overhead 20,000
Variable selling expense is a commission of $3.80 per helmet; fixed selling and administrative
expense totals $29,900.
,1. Calculate the total variable cost per unit.
2. Calculate the total fixed expense for the year. - CORRECT ANSWER-1. 48.05
$29+$11.00+$4.25 +$3.80 = $48.05
*Variable cost per unit = Direct materials + Direct labor + Variable factory overhead + Variable
selling expense
2. 49,900
$20,000 + $29,900 = $49,900
*total fixed factory overhead + fixed selling & administrative expense totals= total fixed expense
Head-First Company plans to sell 4,770 bicycle helmets at $72 each in the coming year. Unit
variable cost is $45 (includes direct materials, direct labor, variable factory overhead, and
variable selling expense). Total fixed cost equals $49,500 (includes fixed factory overhead and
fixed selling and administrative expense). Break-even units equal 1,833.
1.Calculate the margin of safety in terms of the number of units.
2. Calculate the margin of safety in terms of sales revenue. - CORRECT ANSWER-1. 2937
4770-1833= 2937
* Budgeted units- break even units= margin of safety in units
, 2. 211464
343440- 131976= 211464
* budgeted sales- break even sales= margin of safety in sales revenue
Head-First Company had planned to sell 5,000 bicycle helmets at $68 each in the coming year.
Unit variable cost is $44 (includes direct materials, direct labor, variable factory overhead, and
variable selling expense). Total fixed cost equals $49,500 (includes fixed factory overhead and
fixed selling and administrative expense). Operating income at 5,000 units sold is $70,500. The
degree of operating leverage is 1.7. Now Head-First expects to increase sales by 10% next year.
1. Calculate the percent change in operating income expected.
2. Calculate the operating income expected next year using the percent change in operating
income calculated in Requirement 1. - CORRECT ANSWER-1. 17%
1.7 x 10%= 17%
* DOL × Percent Change in Sales= Percent Change in Operating Income
2. 82485
$70,500 + (0.17 × $70,500)= 82485
*Original Income + (Percent Change × Original Income)= Expected Operating Income
QUESTIONS AND VERIFIED
CORRECT ANSWERS
GRADED A+ LATEST 100%
GUARANTEED PASS
If price is $10, unit variable cost is $2.50, and total fixed cost is 3,000, the unit contribution
margin is $7.50. T/F - CORRECT ANSWER-TRUE
The breakeven in sales dollars equation is total fixed expenses divided by the contribution
margin ratio. T/F - CORRECT ANSWER-TRUE
Tacos-2-Go could reduce their variable costs by shopping at wholesale supplies over local
groceries. T/F - CORRECT ANSWER-TRUE
Total fixed costs, price, and unit variable costs all have an impact on the breakeven point. T/F -
CORRECT ANSWER-TRUE
Graphically, the breakeven point is where the contribution margin crosses the fixed cost line. T/F
- CORRECT ANSWER-TRUE
If the gym's monthly unlimited plan cost $100 and the daily plan cost $12, Lacy would need to
go to the gym at least 10 times per month for the monthly plan to be the better deal. T/F -
CORRECT ANSWER-FALSE
,If the gym's monthly unlimited plan cost $50 and the daily plan cost $8, Lacy should use the
daily plan if she only intends to go to the gym 6 times per month. T/F - CORRECT ANSWER-TRUE
CHAPTER 7- HW - CORRECT ANSWER-
Head-First Company plans to sell 5,200 bicycle helmets at $73 each in the coming year. Unit
variable cost is $47 (includes direct materials, direct labor, variable factory overhead, and
variable selling expense). Total fixed cost equals $49,300 (includes fixed factory overhead and
fixed selling and administrative expense).
Calculate the number of helmets Head-First must sell to earn operating income of $66,140. -
CORRECT ANSWER-4440
($49,300 + $66,140) ÷ ($73 − $47) = 4,440
*Break-even units = (Total fixed cost + Target income)/ Unit contribution margin
Head-First Company plans to sell 5,800 bicycle helmets at $67 each in the coming year. Product
costs include:
Direct materials per helmet $29
Direct labor per helmet 11.00
Variable factory overhead per helmet 4.25
Total fixed factory overhead 20,000
Variable selling expense is a commission of $3.80 per helmet; fixed selling and administrative
expense totals $29,900.
,1. Calculate the total variable cost per unit.
2. Calculate the total fixed expense for the year. - CORRECT ANSWER-1. 48.05
$29+$11.00+$4.25 +$3.80 = $48.05
*Variable cost per unit = Direct materials + Direct labor + Variable factory overhead + Variable
selling expense
2. 49,900
$20,000 + $29,900 = $49,900
*total fixed factory overhead + fixed selling & administrative expense totals= total fixed expense
Head-First Company plans to sell 4,770 bicycle helmets at $72 each in the coming year. Unit
variable cost is $45 (includes direct materials, direct labor, variable factory overhead, and
variable selling expense). Total fixed cost equals $49,500 (includes fixed factory overhead and
fixed selling and administrative expense). Break-even units equal 1,833.
1.Calculate the margin of safety in terms of the number of units.
2. Calculate the margin of safety in terms of sales revenue. - CORRECT ANSWER-1. 2937
4770-1833= 2937
* Budgeted units- break even units= margin of safety in units
, 2. 211464
343440- 131976= 211464
* budgeted sales- break even sales= margin of safety in sales revenue
Head-First Company had planned to sell 5,000 bicycle helmets at $68 each in the coming year.
Unit variable cost is $44 (includes direct materials, direct labor, variable factory overhead, and
variable selling expense). Total fixed cost equals $49,500 (includes fixed factory overhead and
fixed selling and administrative expense). Operating income at 5,000 units sold is $70,500. The
degree of operating leverage is 1.7. Now Head-First expects to increase sales by 10% next year.
1. Calculate the percent change in operating income expected.
2. Calculate the operating income expected next year using the percent change in operating
income calculated in Requirement 1. - CORRECT ANSWER-1. 17%
1.7 x 10%= 17%
* DOL × Percent Change in Sales= Percent Change in Operating Income
2. 82485
$70,500 + (0.17 × $70,500)= 82485
*Original Income + (Percent Change × Original Income)= Expected Operating Income
