Question : 41. A company’s manager estimates that in the upcoming year, total : 1291715

 

41. A company’s manager estimates that in the upcoming year, total variable costs will increase by $7,500 and total fixed costs will increase by $3,500. Assume that the unit sales price did not change. What will be the anticipated effect on net operating income? A. Net operating income will increase by $11000.B. Net operating income will decrease by $11,000.C. Net operating income will increase by $4,000.D. Net operating income will decrease by $4,000.

 

42. A company’s manager estimates that in the upcoming year, total variable costs will increase by $20,000 and total fixed costs will decrease by $14,000. Assume that the unit sales price did not change. What will be the anticipated effect on net operating income? A. Net operating income will increase by $34,000.B. Net operating income will decrease by $34,000.C. Net operating income will increase by $6,000.D. Net operating income will decrease by $6,000.

 

43. A company’s manager estimates that in the upcoming year, increasing advertising costs by $25,000 will cause sales revenue to increase by $60,000. If the company’s contribution margin ratio is 35%, what will be overall effect on net operating income? A. Net operating income will increase by $12,250.B. Net operating income will increase by $29,750.C. Net operating income will increase by $35,000.D. Net operating income will decrease by $4,000.

 

44. A company’s manager estimates that in the upcoming year, decreasing advertising costs by $50,000 will cause sales revenue to decrease by $120,000. If the company’s contribution margin ratio is 35%, what will be overall effect on net operating income? A. Net operating income will increase by $8,000.B. Net operating income will decrease by $8,000.C. Net operating income will increase by $24,500.D. Net operating income will decrease by $24,500.

 

45. LMN Manufacturing produces two products – Product S and Product W. The following information is available related to each product: 

 

Product S

 

Product W

Sales price per unit

$25

 

$40

Variable costs per unit

17

 

22

 

 

 

 

Product S accounts for 40% of total product sales and Product W accounts for the rest. LMN’s total fixed costs are $24,990. How many total number of products need to be sold in order for the company to break even? A. 1,922 unitsB. 2,403 unitsC. 962 unitsD. 1,785 units

 

46. RET ManufacturingRET Manufacturing produces two types of children’s products – Rubles and Twizzles. The following information is available related to each product: 

 

Rubles

 

Twizzles

Sales price per unit

$15

 

$24

Variable costs per unit

5

 

12

 

 

 

 

Rubles account for 60% of total product sales and Twizzles accounts for the rest. RET’s total fixed costs are $30,024. Refer to the RET Manufacturing information above. How many total number of products need to be sold in order for the company to break even? A. 2,780 unitsB. 2,730 unitsC. 5,560 unitsD. 2,176 units

 

47. RET ManufacturingRET Manufacturing produces two types of children’s products – Rubles and Twizzles. The following information is available related to each product: 

 

Rubles

 

Twizzles

Sales price per unit

$15

 

$24

Variable costs per unit

5

 

12

 

 

 

 

Rubles account for 60% of total product sales and Twizzles accounts for the rest. RET’s total fixed costs are $30,024. Refer to the RET Manufacturing information above. How many Rubles need to be sold in order for the company to break even? A. 1,638 unitsB. 1,668 unitsC. 819 unitsD. 2,780 units

 

48. Crabtree Inc. produces two types of products – Gizmos and Gadgets. The following information is available related to each product: 

 

Gizmos

 

Gadgets

Sales price per unit

$32

 

$50

Variable costs per unit

17

 

22

 

 

 

 

Percentage of total sales

66.67%

 

33.33%

 

 

 

 

If total fixed costs are $29,000, how many total units need to be sold in order for the company to break even? (round computations to nearest number) A. 1,933 unitsB. 1,036 unitsC. 1,500 unitsD. 1,349 units

 

49. Crabtree Inc. produces two types of products – Gizmos and Gadgets. The following information is available related to each product: 

 

Gizmos

 

Gadgets

Sales price per unit

$80

 

$50

Variable costs per unit

36

 

22

 

 

 

 

Three-fourths of the products sold are Gizmos and one-fourth are Gadgets. If total fixed costs are $50,000, how many total units need to be sold in order for the company to break even? A. 1,250 unitsB. 1,389 unitsC. 2,500 unitsD. 690 units

 

50. Village ManufacturingVillage Manufacturing produces two types of products – Card Games and Puzzles. The following information is available related to each product: 

 

Card Games

 

Puzzles

Sales price per unit

$6.00

 

$15.00

Variable costs per unit

2.00

 

3.50

 

 

 

 

60% of the products sold are Card Games and 40% are Puzzles. Refer to the Village Manufacturing information above. If total fixed costs are $24,500, how many Puzzles need to be sold in order for the company to break even? A. 852 unitsB. 1,265 unitsC. 1,400 unitsD. 3,500 units

 

 

 

 

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