Question 1 - Bruno Company accumulates the following data concerning a mixed cost, using miles as the activity level.
|
Miles
Driven
|
Total
Cost
|
|
Miles
Driven
|
Total
Cost
|
|
January
|
7,990
|
$14,155
|
March
|
8,490
|
$14,985
|
|
February
|
7,500
|
13,500
|
April
|
8,205
|
14,495
|
Compute the variable cost per mile using the high-low method.
Compute the fixed cost elements using the high-low method.
Question 2 - Deines Corporation has fixed costs of $4,727,940. It has a unit selling price of $9.10, unit variable cost of $4.03, and a target net income of $1,569,000.
Compute the required sales in units to achieve its target net income.
Question 3 - In the month of March, Style Salon services 620 clients at an average price of $100. During the month, fixed costs were $14,016 and variable costs were 68% of sales.
Determine the contribution margin in dollars, per unit, and as a ratio.
Using the contribution margin technique, compute the break-even point in dollars and in units.