In 2022, Bonita sold 1000 units at $500 each and earned net income of $40000. Unit variable cost was $400 and fixed expenses totaled $160000. The same selling price is expected for 2023. Bonita's unit variable cost will rise by 10% in 2023 due to increasing material costs so they are tentatively planning to cut fixed costs by $10000. If the company is successful in cutting fixed costs by $10000, how many units must Bonita sell in 2023 to maintain the same income level as 2022? Ⓒ1000 3167 2111 1583 eTextbook and Media
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- Baghdad Company produces a single product. They have recently received the result of a market survey that indicates that they can increase the retail price of their product by 10% without losing customers or market share. All other costs will remain unchanged. If they enact the 10% price increase, what will be their new break-even point in units and dollars? Their most recent CVP analysis is:The Numb Co. is expecting an increase in fixed costs by P78,750 upon moving their place of business to the downtown area. Likewise it is anticipating that the selling price per unit and the variable expenses will not change. At present, the sales volume necessary to breakeven is P750,000 but the expected increase in fixed costs, the sales volume necessary to breakeven will go up to P975,000. Based on these predictions, what would be the required peso sales to earn P35,000 in the coming year?The NUBD Co. is expecting an increase in fixed costs by P78,750 upon moving their place of business to the downtown area. Likewise it is anticipating that the selling price per unit and the variable expenses will not change. At present, the sales volume necessary to breakeven is P750,000 but the expected increase in fixed costs, the sales volume necessary to breakeven will go up to P975,000. Based on these predictions, what would be the required peso sales to earn P35,000 in the coming year? A. P1,175,000 B. P950,000 C. P425,000 D. P1,075,000
- Shiela Co. is expecting an increase in fixed costs by P78,750 upon moving their place of business to the downtown area. Likewise it is anticipating that the selling price per unit and the variable expenses will not change. At present, the sales volume necessary to breakeven is P750,000 but the expected increase in fixed costs, the sales volume necessary to breakeven will go up to P975,000. Based on these predictions, what would be the required peso sales to earn P35,000 in the coming year?The B Co. is expecting an increase in fixed costs by P78,750 upon moving their place of business to the downtown area. Likewise it is anticipating that the selling price per unit and the variable expenses will not change. At present, the sales volume necessary to breakeven is P750,000 but the expected increase in fixed costs, the sales volume necessary to breakeven will go up to P975,000. Based on these predictions, what would be the required peso sales to earn P35,000 in the coming year? A.P1,175,000 B.P950,000 C.P425,000 D.P1,075,0003) If demand for 2022 is instead 2,500 units should the company pay to increase their capacity? Why? Please explain your calculations and reference to the chart in Figure 1. Assume units are sold at the normal price. Please mention the concept of incremental profits. Hint: If you expand capacity, you will have to pay additional fixed costs of $25,000. Remember that fixed costs are fixed within the relevant range. If you expand capacity then you are outside this range. If you expand capacity then you can make revenue on 500 additional units at the normal price and would pay variable costs on 500 additional units. Please consider the incremental profit or loss of expanding capacity. The incremental profit is the increase in revenues minus the increase in costs of adding 500 more units. If the incremental profit of expanding capacity is positive then you should do so.
- In 2019, Bonita sold 1000 units at $500 each, and earned net income of $40000. Variable expenses were $200 per unit, and fixed expenses were $220000. The same selling price is expected for 2020. Bonita’s variable cost per unit will rise by 10% in 2020 due to increasing material costs, so they are tentatively planning to cut fixed costs by $10000. How many units must Bonita sell in 2020 to maintain the same income level as 2019? A. 806 B. 893 C. 1000 D. 926The company is planning to use a new material throughout 2023. This will reduce variable costs by 10%. Fixed costs are expected to remain unchanged. As the factory's output is nearing its annual output capacity of 38,000 units, the company plans to increase the selling price by 5%. This will decrease sales volume by 20%. Use cost-volume-profit analysis to determine whether the company should proceed with the plan.Newton cellular manufactures and sells the top line cell phone for the year 2022. Newton has estimated the following: contribution margin per phone $200 variable cost per Cellphone 450 annual fix cost total 180,000 net loss -$400 Given: Variable Cost as a %of sales 70%Annual fixed costs - total $600,000 What is the contribution margin ratio? What is the break even point in sales dollars? If the company is operating at a $100,000 loss what are the dollar sales? If the company is operating at a $100,000 profit what are the dollar sales?
- The Rizal Marketing Company is expecting an increase of fixed costs by P78,750 upon moving their place of business to the downtown area. Likewise, it is anticipating that the selling price per unit and the variable expenses will not change. At present, the sales volume necessary to breakeven is P750,000 but with the expected increase in fixed costs, the sales volume necessary to breakeven would go up to P975,000. Based on these projections, what would be the total fixed costs before the increase of P78,750? Choices P262,500 P300,000 P183,750 P341,250In 2019, Reyes Company provided the following data: Sales price per unit P100; Variable cost per unit P60; Total fixed cost at P1,500,000. For 2020, Papa Company is planning to buy a machine that will reduce the production workers and cut the sales price of the product at the same time. The new machine will increase the fixed cost by P500,000 due to depreciation; variable cost per unit will decrease by 25% due to reduction of direct workers; and the sales price will be reduced by 10%. What is the profit (before tax) if the company produces and sells 45,000 units in 2020? a.28,000 b.25,000 c.27,000 d.26,000 What is the break-even units in 2020? a.37.500 b.50,000 c.44,444 d.45,000 What is the profit if the company operates at 45,000-unit volume? a.P600,000 b.P300,000 c.P 45,000 d.None of the aboveIn 2019, Preston Company provided the following data: Sales price per unit P100; Variable cost per unit P60; Total fixed cost at P1,500,000. For 2020, Preston Company is planning to buy a machine that will reduce the production workers and cut the sales price of the product at the same time. The new machine will increase the fixed cost by P500,000 due to depreciation; variable cost per unit will decrease by 25% due to reduction of direct workers; and the sales price will be reduced by 10%. What is the break-even units in 2020? 44,444 45,000 50,000 37.500