Problem II- (B) – (10 points)   (Make sure to show work so t…

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Questions

Prоblem II- (B) - (10 pоints)   (Mаke sure tо show work so thаt pаrtial credit may be given.)   Hosmer Co. has fixed costs totaling $165,000. Its unit contribution margin is $1.50, and the selling price is $5.50 per unit. Compute the break-even point in units.    Johnson Company had Sales of $340,000, Variable costs of $180,000, Contribution Margin of $160,000, fixed costs of $70,000, and Income from     Operations of $90,000. Compute Johnson Company’s operating leverage.    Donald Company has fixed costs of $480,000. It has a unit-selling price of $6, unit variable costs of $4.40, and a target net income of $1,500,000. Compute the required sales in units to achieve its target net income.   For Murphy Company, actual sales are $2,000,000, and break-even sales are $1,500,000. Compute (a) the margin of safety in dollars, and (b) the margin of safety ratio.    For Rockett Company, sales are $500,000, variable costs are $200,000, and fixed costs are $240,000. Compute (a) the contribution margin in dollars, (b) the contribution margin ratio.       Formula Hints EUFIFO = EUBWIP + USC + EUEWIP VCPU = CITC / CIA       -      (HLM) CM$ = SR - VC UCM = USP – UVC CMR = UCM / USP BEPU = FC / UCM BEP$ = FC / CMR TSUTNI = (FC+TNI) / UCM TS$TNI = (FC +TNI) / CMR  MS$ = AS – BES  MSR = MS$ / AS  OL = CM / INCOP

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