Managerial Accounting
Essay Preview: Managerial Accounting
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Nanuka RamishviliManagerial AccoutingHomework Set #1Exercise #1 Fill in the blanks for each of the following independent casesCaseSelling priceVariable costs per unitTotal units soldTotal contribution marginTotal fixed costsOperating profit/lossa€30€2070 000€700000(30-20)*70000€715000700000-x=-15000-€15 000b 25 20 25-x=5180 000900 000800 000100000900K-800Kc 12x-10=12 10150 000300 000220 00080000d 20 14 20000120 000 108000120K-x=12K000Exercise #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 unite) 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$. Fixed cost 7500; 7500+2000=9500. 9500/(25-20)=1900 units must be sold to reach operating income of 2000Exercise #9The summarized profit and loss statement for ABC plc for the last year is as follows;$ 000$ 000Sale (50 000 units) 1000 Direct materials 350 V Direct wages 200 V Fixed production overhead 200 FVariable production overhead 50 V Administration overhead 180 FSelling and distribution overhead120 FTotal expenses1100 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.