Question 1. Rierson Inc. produces and sells two products. Data concerning those products for the most recent month appear below:
Product T77G Product I29C
Sales $14,000 $19,000
Variable expenses $5,180 $9,340
The fixed expenses of the entire company were $17,730. The break-even point for the entire company is closest to:
a. $32,250
b. $17,730
c. $31,661
d. $15,270
Question 2: Forest Corporation has prepared the following budgeted data based on a sales forecast of $3,000,000:
Variable Fixed
Direct materials $800,000
Direct labor $700,000
Manufacturing overhead $300,000 $450,000
Selling expenses $120,000 $180,000
Administrative expenses $30,000 $70,000
What would be the amount of dollar sales at the break-even point?
a. $1,125,000
b. $2,000,000
c. $2,650,000
d. $1,750,000
Question 3: Hilty Corporation produces and sells two products. In the most recent month, Product U77D had sales of $45,000 and variable expenses of $15,750. Product D86D had sales of $49,000 and variable expenses of $22,790. And the fixed expenses of the entire company were $46,170. The break-even point for the entire company is closest to:
a. $47,830
b. $84,710
c. $46,170
d. $78,254
Question 4: Riven Corporation has a single product whose selling price is $10. At an expected sales level of $1,000,000, the company's variable expenses are $600,000 and its fixed expenses are $300,000. The marketing manager has recommended that the selling price be increased by 20%, with an expected decrease of only 10% in unit sales. What would be the company's net operating income if the marketing manager's recommendation is adopted?
a. $132,000
b. $290,000
c. $180,000
d. $240,000
Question 5: Terres Corporation produces and sells a single product. Data concerning that product appear below:
Selling price per unit $100
Variable expense per unit $33
Fixed expense per unit $293,460
The break-even in monthly dollar sales is closest to:
a. $889,273
b. $438,000
c. $293,460
d. $540,244.