...Cost-Volume-Profit (CVP) Analysis considers the impact that changes in output have on revenue, costs, and net income. In applying CVP Analysis, costs are separated into variable and fixed costs. This distinction is important because, as mentioned previously, variable costs change with changes in output, whereas fixed costs remain constant throughout what is referred to as a relevant range. CVP analysis is based on the following equation: Profit = Total Revenues - Total variable costs - Total fixed costs Read more: http://wiki.answers.com/Q/How_CVP_analysis_is_used_in_managerial_accounting_decision_making#ixzz1Xg3K6A6I The formula BEQ= FC/P-VC Where: BEQ = Breakeven Quantity FC= Fixed Costs P= Price Charged per unit VC= Variable Costs of production From the Example:- BEQ= FC/P-VC = $588,000 / (12.5 – 5.5) = $588,000 / 7 = 84,000 Flags So the company has to sell to breakeven Breakeven sales in dollars To compute contribution margin ratio = Contribution Margin per Unit Sales Price per Unit = 588,000 / (7/12.5) = 588,000 / .56 = $1,050,000 Variable Cost per ratio = Variable Cost per Unit / Sales Price per unit Desired net profit of $32,200...
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...Practice Final Answer Key Answer Key 1. Direct materials used = 6,000 + 7,000 – 1,000 = 12,000 Cost of goods manufactured = 12,000 + 5,000 + (600 + 500 + 1,900 + 3,500) + 800 – 3,000 = 21,300 Cost of goods sold = 4,000 + 21,300 – 5,300 = 20,000 Gross margin = 31,800 – 20,000 = 11,800 2. B 3. D 4. D Sales 350,000 – CGS 160,000 = 190,000 5. B Sales 350,000 – CGS (variable) 160,000 – Var Sell and Adm 35,000 – Var Adm 15,000 = 140,000 6. C 7. A Orig data CM 20.00 X 3000 = 60,000 – FC 25,000 = NI 35,000 New scenario CM 12.50 X 2250 = 28,125 – FC 25,000 = NI 3,125 Decrease of 31,875 8. C BEP Sales = Fixed Exp/CM ratio = 1,400,000/.35 (2,100.000 / 6,000,000) = 4,000,000 9. B BEP Units = Fixed Exp / Unit CM ratio = 130,000 / 13.00 = 10,000 130,000 = Fixed Manu of 60,000 + Fixed selling and adm of 70,000 The 13.00 unit cm margin is calculated by dividing sales and var costs by 50,000. 10. C Var Exp / Unit = Unit Price – contribution margin ratio 36.00 = 60.00 – 24.00 (40% of $60.00 per unit) 11. B BEP Sales = 28,800 / .4 = 72,000 12. C 13. A DM 13.00 + DL 55.00 + V OH 1.00 = 69.00 14. D DM 13.00 + DL 55.00 + V OH 1.00 + F OH 15.00 = 84.00 F OH = 130,500 / 8,700 15. A Sales (8,300 X $92) $763,600 Variable Expenses Beg Inv...
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...Case Study 1 Supplied Information Materials Purchased Direct Labor Sales Gross Margin Cost of Goods Available for Sale Prime Costs Manufacturer Overhead Direct Materials Beginning Balances Raw Materials Works in Progress Finished Goods Notes Conversion cost = Manufacturing overhead + direct labor Known: Manufacturing overhead= 65% of conversion Direct labor= Direct = 35% of Conversion costs 220,000= 35% of Conversion 220,000/.35= Conversion cost Conversion cost = Manufacturing overhead + direct labor Direct labor= Manufacturing overhead = Prime Cost = direct materials cost + direct labor costs. 545,000 = direct materials cost + 220,000 Direct materials cost = 325,000 $325,000 $220,000 $1,350,000 30% $1,020,000 $545,000 65% of Conversion $325,000 $41,000 $56,000 $35,000 $220,000 35% $628,571 $220,000 $408,571 Answers Raw Materials Cost (purchased) Work in Progress Finished Goods Inventory $325,000 $24,471 $75,000 Calculations Calculating Gross Margin Sales Cost of Goods Sold: Beginning Finished Goods Inventory Add: Cost of Goods Manufactured Cost of Goods Available for Sale Deduct: Ending Finished Goods Inventory *Gross Margin *Gross Margin= 30%($1,350,000) Cost of Goods Sold Beginning balance finished goods Add: Cost of goods manufactured Goods available for sale Less: Ending balance, finished goods Cost of goods sold Total manufacturing cost Direct materials Direct labor Manufacturing overhead Total manufacturing cost $ 35,000 985,000 1,020,000 75,000 $ ...
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...Page: | 1 2 | 1. | Question : | (TCO A) The variable portion of advertising costs is a | | | Student Answer: | | Conversion YES... Period NO. | | | | Conversion YES .... Period YES. | | | | Conversion NO.... Period YES. | | | | Conversion NO.... Period NO. | | Instructor Explanation: | Chapter 2 | | | | Points Received: | 0 of 6 | | Comments: | | | | 2. | Question : | (TCO A) The costs of staffing and operating the accounting department at Central Hospital would be considered by the Department of Surgery to be | | | Student Answer: | | direct costs. | | | | sunk costs. | | | | incremental costs. | | | | None of the above | | Instructor Explanation: | Chapter 2 | | | | Points Received: | 0 of 6 | | Comments: | | | | 3. | Question : | (TCO A) The cost of lubricants used to grease a production machine in a manufacturing company is an example of a(n): | | | Student Answer: | | period cost. | | | | direct material cost. | | | | indirect manufacturing cost. | | | | direct labor cost. | | | | None of the above | | Instructor Explanation: | Chapter 2 | | | | Points Received: | 6 of 6 | | Comments: | | | | 4. | Question : | (TCO A) When the activity level is expected to increase within the relevant range, what effects would be anticipated with respect to each of the following? | | | Student Answer: | | Fixed...
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...1. (TCO F) Buckhorn Corporation bases its predetermined overhead rate on the estimated machine hours for the upcoming year. Data for the upcoming year appear below. Estimated machine hours - 85,000 Estimated variable manufactruring overhead - $5.55 per machine hour Estimated total fixed manufacturing overhead - $951,888 Compute the company's predetermined overhead rate. Total variable manufacturing overhead = $5.55 * 85000 = $471750 So, total predetermined overhead = $951888 - 471450 = $480138 SO, Predetermined overhead rate = $480138 / 85000 = $5.648 per machine hour |Cash balance, beginning |27,000 | |Add receipts |136,000 | |Total cash available for needs |163,000 | | | | |Disbursements |128,000 | |Minimum cash balance desired |50,000 | |Total cash needed |178,000 | | | | |Cash excess (deficiency) |(15,000) | | | | |Financing: ...
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...ACCT 505 Entire Course For more classes visits www.snaptutorial.com ACCT 505 Week 1-7 All Discussion Questions ACCT 505 Week 1 Case Study ACCT 505 Week 2 Quiz Job Order and Process Costing Systems ACCT 505 Week 3 Case Study II ACCT 505 Week 4 Midterm Exam ACCT 505 Week 5 Measuring Performance - Course Project A ACCT 505 Week 6 Quiz Segment Reporting and Relevant Costs for Decisions ACCT 505 Week 7 Capital Budgeting Course Project ----------------------------------------------------------- ACCT 505 Final Exam For more classes visits www.snaptutorial.com ACCT 505 Final Exam ------------------------------ ACCT 505 Week 1 Case Study For more classes visits www.snaptutorial.com Top Switch Inc. designs and manufactures switches used in telecommunications. Serious flooding throughout the state of Tennessee affected Top Switch’s facilities. Inventory was completely ruined, and the company’s computer system, including all accounting records, was destroyed. Before the unfortunate incident, recovery specialists cleaned the buildings. The company controller is very nervous and anxious to recover whatever records he can to support the insurance claim for the destroyed inventory. After consulting with the cost accountant, they decide to retrieve the previous year’s annual report for the beginning inventory numbers. In addition, they also agreed that they need first quarter cost data. The cost accountant was working on the first quarter results...
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...ACCT 505 Entire Course ¬For more classes visits www.snaptutorial.com ACCT 505 Week 1-7 All Discussion Questions ACCT 505 Week 1 Case Study ACCT 505 Week 2 Quiz Job Order and Process Costing Systems ACCT 505 Week 3 Case Study II ACCT 505 Week 4 Midterm Exam ACCT 505 Week 5 Measuring Performance - Course Project A ACCT 505 Week 6 Quiz Segment Reporting and Relevant Costs for Decisions ACCT 505 Week 7 Capital Budgeting Course Project --------------------------------------------------------- ACCT 505 Final Exam ¬For more classes visits www.snaptutorial.com ACCT 505 Final Exam --------------------------------------------------------- ACCT 505 Week 1 Case Study ¬For more classes visits www.snaptutorial.com Top Switch Inc. designs and manufactures switches used in telecommunications. Serious flooding throughout the state of Tennessee affected Top Switch’s facilities. Inventory was completely ruined, and the company’s computer system, including all accounting records, was destroyed. Before the unfortunate incident, recovery specialists cleaned the buildings. The company controller is very nervous and anxious to recover whatever records he can to support the insurance claim for the destroyed inventory. After consulting with the cost accountant, they decide to retrieve the previous year’s annual report for the beginning inventory numbers. In addition, they also agreed that they need first quarter cost data. The cost accountant...
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...ACCT 505 FULL WEEK 6 To purchase this visit following link: http://www.activitymode.com/product/acct-505-full-week-6/ Contact us at: SUPPORT@ACTIVITYMODE.COM ACCT 505 FULL WEEK 6 ACCT 505 Full Week 6 ACCT 505 Week 6 Quiz ACCT 505 Week 6DQ 1 Segment Reporting & Relevant Costs ACCT 505 Week 6 DQ 2 Research and Application Activity mode aims to provide quality study notes and tutorials to the students of ACCT 505 Full Week 6 in order to ace their studies. ACCT 505 FULL WEEK 6 To purchase this visit following link: http://www.activitymode.com/product/acct-505-full-week-6/ Contact us at: SUPPORT@ACTIVITYMODE.COM ACCT 505 FULL WEEK 6 ACCT 505 Full Week 6 ACCT 505 Week 6 Quiz ACCT 505 Week 6DQ 1 Segment Reporting & Relevant Costs ACCT 505 Week 6 DQ 2 Research and Application Activity mode aims to provide quality study notes and tutorials to the students of ACCT 505 Full Week 6 in order to ace their studies. ACCT 505 FULL WEEK 6 To purchase this visit following link: http://www.activitymode.com/product/acct-505-full-week-6/ Contact us at: SUPPORT@ACTIVITYMODE.COM ACCT 505 FULL WEEK 6 ACCT 505 Full Week 6 ACCT 505 Week 6 Quiz ACCT 505 Week 6DQ 1 Segment Reporting & Relevant Costs ACCT 505 Week 6 DQ 2 Research and Application Activity mode aims to provide quality study notes and tutorials to the students of ACCT 505 Full Week 6 in order to ace their studies. ACCT 505 FULL WEEK 6 To purchase this visit following link: http://www.activitymode...
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...ACCT 505 FULL WEEK 2 To purchase this visit following link: http://www.activitymode.com/product/acct-505-full-week-2/ Contact us at: SUPPORT@ACTIVITYMODE.COM ACCT 505 FULL WEEK 2 ACCT 505 Full Week 2 ACCT 505 Week 2 Chaper 3 Systems Design – Job-Order Costing ACCT 505 Week 2 DQ 1 Job Order and Process Costing Systems ACCT 505 Week 2 DQ 2 Research and Application ACCT 505 Week 2 Quiz Activity mode aims to provide quality study notes and tutorials to the students of ACCT 505 Full Week 2 in order to ace their studies. ACCT 505 FULL WEEK 2 To purchase this visit following link: http://www.activitymode.com/product/acct-505-full-week-2/ Contact us at: SUPPORT@ACTIVITYMODE.COM ACCT 505 FULL WEEK 2 ACCT 505 Full Week 2 ACCT 505 Week 2 Chaper 3 Systems Design – Job-Order Costing ACCT 505 Week 2 DQ 1 Job Order and Process Costing Systems ACCT 505 Week 2 DQ 2 Research and Application ACCT 505 Week 2 Quiz Activity mode aims to provide quality study notes and tutorials to the students of ACCT 505 Full Week 2 in order to ace their studies. ACCT 505 FULL WEEK 2 To purchase this visit following link: http://www.activitymode.com/product/acct-505-full-week-2/ Contact us at: SUPPORT@ACTIVITYMODE.COM ACCT 505 FULL WEEK 2 ACCT 505 Full Week 2 ACCT 505 Week 2 Chaper 3 Systems Design – Job-Order Costing ACCT 505 Week 2 DQ 1 Job Order and Process Costing Systems ACCT 505 Week 2 DQ 2 Research and Application ACCT 505 Week 2 Quiz Activity mode aims to provide...
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...ACCT 505 FULL WEEK 7 To purchase this visit following link: http://www.activitymode.com/product/acct-505-full-week-7/ Contact us at: SUPPORT@ACTIVITYMODE.COM ACCT 505 FULL WEEK 7 ACCT 505 Full Week 7 ACCT 505 Week 7 Course Project Part B ACCT 505 Week 7 DQ 1 Capital Budgeting ACCT 505 Week 7 DQ 2 Exam Review Activity mode aims to provide quality study notes and tutorials to the students of ACCT 505 Full Week 7 in order to ace their studies. ACCT 505 FULL WEEK 7 To purchase this visit following link: http://www.activitymode.com/product/acct-505-full-week-7/ Contact us at: SUPPORT@ACTIVITYMODE.COM ACCT 505 FULL WEEK 7 ACCT 505 Full Week 7 ACCT 505 Week 7 Course Project Part B ACCT 505 Week 7 DQ 1 Capital Budgeting ACCT 505 Week 7 DQ 2 Exam Review Activity mode aims to provide quality study notes and tutorials to the students of ACCT 505 Full Week 7 in order to ace their studies. ACCT 505 FULL WEEK 7 To purchase this visit following link: http://www.activitymode.com/product/acct-505-full-week-7/ Contact us at: SUPPORT@ACTIVITYMODE.COM ACCT 505 FULL WEEK 7 ACCT 505 Full Week 7 ACCT 505 Week 7 Course Project Part B ACCT 505 Week 7 DQ 1 Capital Budgeting ACCT 505 Week 7 DQ 2 Exam Review Activity mode aims to provide quality study notes and tutorials to the students of ACCT 505 Full Week 7 in order to ace their studies. ACCT 505 FULL WEEK 7 To purchase this visit following link: http://www.activitymode.com/product/acct-505-full-week-7/ ...
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...ACCT 505 FULL WEEK 5 To purchase this visit following link: http://www.activitymode.com/product/acct-505-full-week-5/ Contact us at: SUPPORT@ACTIVITYMODE.COM ACCT 505 FULL WEEK 5 ACCT 505 Full Week 5 ACCT 505 Week 5 Course Project Part A ACCT 505 Week 5 DQ 1 Standards, Variances, Flexible Budgets ACCT 505 Week 5 DQ 2 Research and Application Activity mode aims to provide quality study notes and tutorials to the students of ACCT 505 Full Week 5 in order to ace their studies. ACCT 505 FULL WEEK 5 To purchase this visit following link: http://www.activitymode.com/product/acct-505-full-week-5/ Contact us at: SUPPORT@ACTIVITYMODE.COM ACCT 505 FULL WEEK 5 ACCT 505 Full Week 5 ACCT 505 Week 5 Course Project Part A ACCT 505 Week 5 DQ 1 Standards, Variances, Flexible Budgets ACCT 505 Week 5 DQ 2 Research and Application Activity mode aims to provide quality study notes and tutorials to the students of ACCT 505 Full Week 5 in order to ace their studies. ACCT 505 FULL WEEK 5 To purchase this visit following link: http://www.activitymode.com/product/acct-505-full-week-5/ Contact us at: SUPPORT@ACTIVITYMODE.COM ACCT 505 FULL WEEK 5 ACCT 505 Full Week 5 ACCT 505 Week 5 Course Project Part A ACCT 505 Week 5 DQ 1 Standards, Variances, Flexible Budgets ACCT 505 Week 5 DQ 2 Research and Application Activity mode aims to provide quality study notes and tutorials to the students of ACCT 505 Full Week 5 in order to ace their studies. ACCT 505 FULL WEEK...
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...ACCT 505 Entire Course (DEVRY) For more course tutorials visit www.tutorialrank.com ACCT 505 Week 1-7 All Discussion Questions ACCT 505 Week 1 Case Study ACCT 505 Week 2 Quiz Job Order and Process Costing Systems ACCT 505 Week 3 Case Study II ACCT 505 Week 4 Midterm Exam ACCT 505 Week 5 Measuring Performance - Course Project A ACCT 505 Week 6 Quiz Segment Reporting and Relevant Costs for Decisions ACCT 505 Week 7 Capital Budgeting Course Project ---------------------------------------------------------------------------------------------------------------------- ACCT 505 Week 1 Case Study (DEVRY) For more course tutorials visit www.tutorialrank.com Top Switch Inc. designs and manufactures switches used in telecommunications. Serious flooding throughout the state of Tennessee affected Top Switch’s facilities. Inventory was completely ruined, and the company’s computer system, including all accounting records, was destroyed. Before the unfortunate incident, recovery specialists cleaned the buildings. The company controller is very nervous and anxious to recover whatever records he can to support the insurance claim for the destroyed inventory. After consulting with the cost accountant, they decide to retrieve the previous year’s annual report for the beginning inventory numbers. In addition, they also agreed that they need first quarter cost data. The cost accountant was working on the first quarter results before the storm hit, and to his surprise...
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...ACCT 505 Final Exam (Package) Purchase here http://devrycourse.com/ACCT%20505/acct-505-final-exam-package Product Description 1Version 1 1. (TCO A) Wages paid to the factory maintenance supervisor are considered an example of: (Points : 5) 2. (TCO A) Rent on a manufacturing plant is an element of: (Points : 5) 3. (TCO B) Evergreen Corp. has provided the following data: (Points : 5) 4. (TCO B) Garth Company sells a single product. If the selling price per unit and the variable expense per unit both increase by 10% and fixed expenses do not change, then: (Points : 5) 5. (TCO E) Rebel Company manufactures a single product and has the following cost structure: Variable costs per unit:……………. (Points : 5) 6. (TCO F) Vagon Corporation has provided data concerning the company's Manufacturing Overhead account for the month of September. Prior to the closing of the overapplied or underapplied balance to Cost of Goods Sold, the total of the debits to the Manufacturing Overhead account was $76,000 and the total of the credits to the account was $86,000. Which of the following statements is true? (Points : 5) 7. (TCO G) The net present value (NPV) method of investment project analysis assumes that the project's cash flows are reinvested at the:………… (Points : 5) 8. (TCO G) Logan Company is considering two projects, A and B. The following information has been gathered on these projects:……….Based on this information, which of the following statements is (are) true? I...
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...Case Study I ACCT-505 Managerial Accounting Information Provided Materials Purchased $325,000 Direct Labor $220,000 Sales $1,350,000 Gross Margin 30% Cost of Goods Available for Sale $1,020,000 Prime Costs $545,000 Manufacturer Overhead 65% Conversion Direct Materials $325,000 Beginning Balances Raw Materials $41,000 Works in Progress $56,000 Finished Goods $35,000 Conversion Cost= Manufacturing Overhead + Direct Labor Manufacturing Overhead= 65% of Conversion Direct labor= $220,000 Direct = 35% of Conversion 220,000= 35% of Conversion cost Conversion Cost= Manufacturing Overhead + Direct Labor $628,571 Direct Labor= $220,000 Manufacturing Overhead $408,571 Prime Cost= Direct Materials Cost = Direct Labor Costs 545,000 = Direct Materials Cost + 220,000 Direct Materials Cost= 325,000 Gross Margin Sales $1,350,000 Cost of Goods Sold: Beginning Finished Goods Inventory 35,000 Add: Cost of Goods Manufactured 985,000 Cost of Goods Available for Sale 1,020,000 Less: Ending Finished Goods Inventory (75,000) (945,000) Gross Margin $405,000 1,350,000*.3= 405,000 Cost of Goods Sold Beginning balance finished goods $35,000 Add: Cost of Goods Manufactured 985,000 Goods Available for Sale $1,020,000 Less: Ending Balance, Finished Goods (945,000) Cost of Goods Sold $75,000 Total Manufacturing Cost Direct Materials $325,000 Direct Labor 220,000 Manufacturing Overhead ...
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...ACCT 505 Solutions to Weekly Problems - Week 1 Exercise 2-4 (20 minutes) 1. | | Occupancy-Days | Electrical Costs | | High activity level (August) | 3,608 | $8,111 | | Low activity level (October) | 186 | 1,712 | | Change | 3,422 | $6,399 | Variable cost = Change in cost ÷ Change in activity = $6,399 ÷ 3,422 occupancy-days = $1.87 per occupancy-day | Total cost (August) | $8,111 | | Variable cost element ($1.87 per occupancy-day × 3,608 occupancy-days) | 6,747 | | Fixed cost element | $1,364 | 2. Electrical costs may reflect seasonal factors other than just the variation in occupancy days. For example, common areas such as the reception area must be lighted for longer periods during the winter. This will result in seasonal effects on the fixed electrical costs. Additionally, fixed costs will be affected by how many days are in a month. In other words, costs like the costs of lighting common areas are variable with respect to the number of days in the month, but are fixed with respect to how many rooms are occupied during the month. Other, less systematic, factors may also affect electrical costs such as the frugality of individual guests. Some guests will turn off lights when they leave a room. Others will not. Exercise 2-12 (20 minutes) 1. | | Miles Driven | Total Annual Cost* | | High level of activity | 120,000 | $13,920 | | Low level of activity | 80,000 | 10,880 | | Change...
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