Budgeted information for X Ltd for the following period, analyzed by product, is shown below: Product A Product B Product C Selling price per unit $11 $10.5 $8 Variable costs per unit $5.8 $6 $5.2 Attributable fixed costs $275000 $337000 $296000 Sales Units for Product A 394600, for Product B 591900 and for product C 315680, General fixed costs, which are apportioned to products as a percentage sale are budgeted at $1668000. Required: (1) Calculate the budgeted profit of X Ltd, and each of its products. (2) Recalculate the budgeted profit of X Ltd. On the assumption that product C is discontinued, with no effect on sales of the other two products. State and justify other assumptions made.(3) Calculate the increase in sales volume of product B that is necessary in order to compensate for the effect on profit a 10% reduction in the selling price of the product. State clearly any assumptions made

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter9: Profit Planning And Flexible Budgets

Section: Chapter Questions

Problem 48BEB: Performance Report Based on Budgeted and Actual Levels of Production Balboa Company budgeted...

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Preparing a performance report Use the flexible budget prepared in P7-6 for the 31,000-unit level and the actual operating results listed below for the 31,000-unit level. Required: 1. Prepare a performance report. 2. List the major reasons why the actual operating income at 31,000 units differs from the master budget operating income at 30,000 units in Figure 7-12. 3. Given the level at which the company operated, how was its cost control? Item Direct materials: Direct labor:
Using the following per-unit and total amounts, prepare a flexible budget at the 14,000-, 15,000-, and 16,000-unit levels of production and sales for Natural Products Inc.:
Using High-Low to Calculate Predicted Total Variable Cost and Total Cost for Budgeted Output Refer to the information for Speedy Petes above. Assume that this information was used to construct the following formula for monthly delivery cost. TotalDeliveryCost=41,850+(12.00NumberofDeliveries) Required: Assume that 3,000 deliveries are budgeted for the following month of January. Use the total delivery cost formula for the following calculations: 1. Calculate total variable delivery cost for January. 2. Calculate total delivery cost for January.
Performance Report Based on Budgeted and Actual Levels of Production Balboa Company budgeted production of 4,500 units with the following amounts: At the end of the year, Balboa had the following actual costs for production of 4,700 units: Required: 1. Calculate the budgeted amounts for each cost category listed above for the 4,500 budgeted units. 2. Prepare a performance report using a budget based on expected (budgeted) production of 4,500 units. 3. Prepare a performance report using a budget based on the actual level of production of 4,700 units.
The fixed overhead budgeted for Ranier Industries at an expected capacity of 500,000 units is 1,500,000. Variable costing is used internally, and the net income is adjusted to an absorption costing net income at year-end. Data collected over the last three years show the following: Determine the adjustment each year to convert the variable costing income to absorption costing net income. Compute the absorption costing net income for each year.
Budgeted information for X Ltd for the following period, analyzed by product, is shown below: Product A Product B Product C Selling price per unit $11 $10.5 $8 Variable costs per unit $5.8 $6 $5.2 Attributable fixed costs $275000 $337000 $296000 Sales Units for Product A 394600, for Product B 591900 and for product C 315680, General fixed costs, which are apportioned to products as a percentage sale are budgeted at $1668000. Required: (1) Calculate the budgeted profit of X Ltd, and each of its products. (2) Recalculate the budgeted profit of X Ltd. On the assumption that product C is discontinued, with no effect…
Budgeted information for X Ltd for the following period, analyzed by product, is shown below: Product A Product B Product C Selling price per unit $11 $10.5 $8 Variable costs per unit $5.8 $6 $5.2 Attributable fixed costs $275000 $337000 $296000 Sales Units for Product A is 444000, for Product B is 666000 and for product C 355200 General fixed costs, which are apportioned to products as a percentage sales are budgeted at $1668000. Required: (Recalculate the budgeted profit of X Ltd. On the assumption that product C is discontinued, with no effect on sales of the other two products. State and justify other…
Budgeted information for X Ltd for the following period, analyzed by product, is shown below: Product A Product B Product C Selling price per unit $11 $10.5 $8 Variable costs per unit $5.8 $6 $5.2 Attributable fixed costs $275000 $337000 $296000 Sales Units for Product A is 444000, for Product B is 666000 and for product C is 355200, General fixed costs, which are apportioned to products as a percentage sales are budgeted at $1668000. Required: (1) Calculate the budgeted profit of X Ltd, and each of its products.
The following details relates to the operations of a company for budgeted output of 10000units; selling price- GHC100, total variable cost- GH¢200000, and total fixed cost- GHC400000. At what quantity and value will the company breakeven? A. 5000units and GHC50000 B. 5000units and GHC5300 OC. 4500units and GHC45000 D. 4000unit and GHC40000
The followings are the budget for next financial year (1 January 2023 - 31 December 2023), indicating the average selling price and variable costs of each product category. The common fixed manufacturing overhead and the fixed non-manufacturing overhead costs are estimated to be $1,250,000 and $2,778,320 respectively. Table 1: Budget Jan - Dec 2023 Sales Quantity (in units) In $ Unit selling price Unit production cost Unit selling & admin variable costs (5% of selling price) In $ Revenue Variable Production Costs Selling & Admin Variable Costs Model 1 8,400 600 250 30 Folding Bike Model 2 7,500 400 180 20 Model 3 3,500 480 200 24 Electric Bike 800 2,000 850 100 Total 20,200 5,040,000 3,000,000 1,680,000 1,600,000 11,320,000 (2,100,000)| (1,350,000)| (700,000)| (680,000)| (4,830,000) (252,000) (150,000) (84,000) (80,000) (566,000) Q1. Based on the above budgeted information, calculate the expected breakeven units for the Model 2 folding bikes.
The following production and cost information is for X Company for 2019: Budgeted 10,600 productionunits Budgeted costs: Total fixed Per-unit $9.13 variable Actual $236,000 12,600 productionunits Actual costs: Total fixed Total variable $261,960 $93,625 1. What was the 2019 static budget? 2. What was the 2019 flexible budget?
The Management Accountant of Kafululu Plc has prepared the following budget information for theyear ending 31st December 2022 for product A. Annual Fixed Costs K270,000.00 Variable costs per unit K90.00 Contribution to sales ratio(C/S) 75% Annual budget units 1,500 Required:a) Calculate the contribution per unit for Product A. b) Calculate the Unit Selling Price for Product A. c) Calculate the Break Even Point for Product A. d) Calculate the margin of safety in Units and in percentage terms. e) If the Selling Price per Unit is reduced by 10%, variable cost per Unit is increased to K100.00and Fixed costs remain unchanged, calculate:i. The new Breakeven Point. ii. The total units that should be sold in order to make a profit of K450,000 in 2020.(

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