1. At Flint Company’s break even point of 9,600 units, fixed costs are $249,600 and variable costs are $633,600 in total. The unit sales price is:
a. $66.
b. $26.
c. $40.
d. $92.
e. $118.
2. Conan Company has total fixed costs of $119,000. Its product sells for $59 per unit and variable costs amount to $45 per unit. Next year Conan Company wishes to earn a pretax income that equals 35% of fixed costs. How many units must be sold to achieve this target income level?
a. 7,636.
b. 41,650.
c. 11,475.
d. 53,599.
e. 2,975.
3.
The budgeted income statement presented below is for Griffith Corporation for the coming fiscal year. If Griffith Corporation is able to achieve the budgeted level of sales, its margin of by Text Enhance” name=”_GPLITA_0″>safety in dollars would be (Do not round intermediate calculations):
by Text Enhance” name=”_GPLITA_0″>
a. $263,235.
b. $291,429.
c. $249,165.
d. $151,000.
e. $229,714.
| Sales (61,000 units) | $1,464,000 | |
| Costs: | ||
| Direct materials | $764,800 | |
| Direct labor | 241,000 | |
| Fixed factory overhead | 105,000 | |
| Variable factory overhead | 151,000 | |
| Fixed marketing costs | 111,000 | |
| Variable marketing costs | 51,000 | 1,423,800 |
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| Pretax income | $40,200 |