Question

You are the new cost accountant for ABX Corporation. After careful review of the company’s operations...

You are the new cost accountant for ABX Corporation. After careful review of the company’s operations you have been tasked to determine the company’s break-even point, the numbers sold to meet the company’s target profit and contribution income statement for both outcomes. Management has also asked that you provide the pros and cons for variable, traditional and activity-based costing method. After providing the pros and cons of each method recommend one method for the company’s use and support your discussion.

Company’s Data:

ABX Corporation sold 450,000 units at $75/unit. Fixed cost are $5,300,000 per year. Variable costs are $45 per unit. ABX Corporation desires a target profit of $6,500,000 per year.

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
determine the company’s break-even point, the numbers sold to meet the company’s target profit and contribution...
determine the company’s break-even point, the numbers sold to meet the company’s target profit and contribution income statement for both outcomes, ABX Corporation sold 500,000 units at $65/unit. Fixed cost are $12,500,000 per year. Variable costs are $30 per unit. ABX Corporation desires a target profit of $5,500,000 per year.
Larcker Manufacturing's cost accountant has provided you with the following information for January operations: Direct materials...
Larcker Manufacturing's cost accountant has provided you with the following information for January operations: Direct materials $ 34 per unit Fixed manufacturing overhead costs $ 225,000 Sales price $ 195 per unit Variable manufacturing overhead $ 19 per unit Direct labor $ 25 per unit Fixed marketing and administrative costs $ 195,000 Units produced and sold 5,500 Variable marketing and administrative costs $ 9 per unit b. Determine the variable manufacturing cost per unit. c. Determine the full absorption cost...
Ng Corporation produces and sells only one product; its selling price is $80 and its variable...
Ng Corporation produces and sells only one product; its selling price is $80 and its variable cost is $60 per unit. The company’s monthly fixed expense is $23,000. Required: 1. Using the equation method, determine the unit sales that are required to earn a target profit before tax of $6,000. 2. Using the formula method, determine for the dollar sales that are required to earn a target profit before tax of $7,000. 3. Using the formula method, calculate the number...
Austin Automotive sells an auto accessory for $180 per unit. The company’s variable cost per unit...
Austin Automotive sells an auto accessory for $180 per unit. The company’s variable cost per unit is $30 for direct material, $25 per unit for direct labor, and $17 per unit for overhead. Annual fixed production overhead is $82,280, and fixed selling and administrative overhead is $55,528. Assume a tax rate for the company of 30 percent. If Austin Automotive wants to earn an after-tax profit of $7.20 on each unit sold, how many units must the company sell?
1. Myers Corporation is attempting to develop and market a new garden tractor. Fixed cost to...
1. Myers Corporation is attempting to develop and market a new garden tractor. Fixed cost to develop and produce the new tractor are estimated to $10,000,000 per year. The variable cost to make each tractor has been estimated at $2000. The marketing department has recommended a price of $4000 per tractor. (SHOW WORK) What is the breakeven level of output for the new tractor. What if management expects to generate a target profit (EBIT) of $2,000,000, how many tractors must...
Columbia Products produced and sold 1,200 units of the company’s only product in March. You have...
Columbia Products produced and sold 1,200 units of the company’s only product in March. You have collected the following information from the accounting records: Sales price (per unit) $ 130 Manufacturing costs: Fixed overhead (for the month) 12,000 Direct labor (per unit) 10 Direct materials (per unit) 33 Variable overhead (per unit) 24 Marketing and administrative costs: Fixed costs (for the month) 16,800 Variable costs (per unit) 3    a. Compute the following:    a. Compute the following:    a....
Menlo Company distributes a single product. The company’s sales and expenses for last month follow: Total...
Menlo Company distributes a single product. The company’s sales and expenses for last month follow: Total    Per Unit   Sales $ 318,000 $ 20        Variable expenses 222,600 14        Contribution margin 95,400 $ 6        Fixed expenses 76,800   Net operating income $   18,600 Required: 1. What is the monthly break-even point in unit sales and in dollar sales? 2. Without resorting to computations, what is the total contribution margin at the break-even point? 3-a. How many units would have...
SIMPLE manufactures and sells a single product. The company’s sales and expenses for last quarter follow:...
SIMPLE manufactures and sells a single product. The company’s sales and expenses for last quarter follow: Total Per Unit Sales $600,000 $40 Less: Variable Expenses $420,000 $28 Contribution Margin $180,000 $12 Less: Fixed Expenses $146,520 Net Operating Income $33,480 Required: What is the monthly break-even point in units sold and in sales dollars? Without resorting to computations, calculate the total contribution margin at the break-even point. How many units would have to be sold each quarter to earn a target...
QUESTION 2 SPI-K manufactures and sells a single product. The company’s sales and expenses for last...
QUESTION 2 SPI-K manufactures and sells a single product. The company’s sales and expenses for last quarter follow: Total Per Unit Sales $600,000 $40 Less: Variable Expenses $420,000 $28 Contribution Margin $180,000 $12 Less: Fixed Expenses $146,520 Net Operating Income $33,480 Required: What is the monthly break-even point in units sold and in sales dollars? Without resorting to computations, calculate the total contribution margin at the break-even point. How many units would have to be sold each quarter to earn...
Question A- Keys Company accumulates the following data concerning a mixed cost, using miles as the...
Question A- Keys Company accumulates the following data concerning a mixed cost, using miles as the activity level.                      Miles Driven         Total Cost January            10,000                 $15,000 February            8,000                   13,500 March                9,000                   14,400 April                  7,500                   12,500 Required: Compute the variable and fixed cost elements using the high-low method If it is estimated that 12,000 miles will be drive in May, what is the expected total cost for May?                                                                                                                        (7.5 Marks) B- XYZ Company sells its only product for $40 per unit....
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT