Marginal Costing Basics - Case Studies
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Q. A company has a fixed cost of $60,000 and a contribution margin of $15 per unit. How many units must be sold to achieve a profit of $24,000?
Q. A company has fixed costs of $20,000 and a contribution margin of $10 per unit. How many units must be sold to break even?
Q. A company produces 1,000 units of a product at a variable cost of $5 per unit. What is the total variable cost?
Q. A company produces a product with a variable cost of $25 and a selling price of $50. If the company wants to achieve a profit of $15,000 with fixed costs of $30,000, how many units must be sold?
Q. A product has a selling price of $50, variable costs of $30, and fixed costs of $40,000. What is the margin of safety if the break-even sales are $100,000?
Q. If a company has a contribution margin ratio of 40% and fixed costs of $50,000, what is the sales revenue needed to achieve a target profit of $10,000?
Q. If a company has a total sales of $200,000 and total variable costs of $120,000, what is the contribution margin ratio?
Q. If a company sells 3,000 units at a selling price of $20 per unit and incurs total variable costs of $30,000, what is the total contribution?
Q. If the selling price per unit is $15 and the variable cost per unit is $5, what is the contribution margin per unit?
Q. What is the effect on contribution margin if the variable cost per unit increases by $5 while the selling price remains unchanged?
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