Question 1
Fixed manuf. Cost= 4*15,000= 60,000
Fixed selling =3*15,000= 45,000
Fixed admin.=2*15,000=30,000
Product cost under 10,000 units:
DM+DL+MOH= (6*10,000)+(3.5*10,000)+(1.5*10,000)+60,000=$170,000
Period cost under 10,000 units:
Selling +admin exp= (1*10,000)+45,000+(0.5*10,000)+30,000=$90,000
v.c/ unit under 8,000 units:
6+3.5+1.5+1+0.5= $12.5/unit
Question 2:
Question 3:
1Variable cost per unit
1- COGS= 20/unit
2- Freight = $10/unit
Fixed cost
1- Advertising =10000
2- Insurance = 5000
3- Depreciation = 25000
Mixed cost
1- Salary and commission
Y= 7000+6X
2Y
High
31,000
low
25000
b= change in y/ change in x= 6000/1000= $6
y= a+bX
31000=a+(6*4000)
a= 7000
Y=7000+6X
X
4000
3000
3ABC company
Income statement
For the month ended December 31,2008
Sales (230*5000)
-COGS ( 20*5000)
=GM
-selling and admin expenses
Freight (10*5000)
Advertising
Insurance
Salary and commission
y=7000+(6*5000)
Depreciation
1150,000
(100,000)
1050,000
50,000
10,000
5000
37000
25,000
(12,7000)
923,000
Net income
ABC Company
Income statement
For the month ended December 31, 2008
Sales
-variable costs:
COGS
Freight
Salary &commission
Total variable cost
Contribution margin
-fixed costs:
Advertising
Insurance
Deprecation
Salary& commission
Total fixed costs
Net income
1150,000
100,000
50,000
30,000
(180,000)
970,000
10,000
5000
25,000
7000
(47,000)
923,000