+1-415-315-9853

info@mywordsolution.com

## Accounting

 Accounting Basics Cost Accounting Financial Accounting Managerial Accounting Auditing Taxation

Smith manufactures a single product that it presently sells for Rs 10•00 per unit. The given estimates are available for the next period:

Sales                    6,000 units
Variable costs        Rs 6.00 per unit
Fixed costs            Rs 15,000

Based on the above, the break-even point for the period has been computed as 3,750 units.

If the selling price is raised to Rs 12.00 per unit, sales are estimated to drop to 4,500 units in the period, with no change in unit variable costs or total fixed costs.

Required:

a) If the selling price is raised to Rs 12.00 per unit for the next period:

• Compute, in units, the break-even point and the margin of safety.
• Describe why the estimated break-even point and margin of safety would both decrease.

b) If the selling price remains at Rs 10.00 per unit, compute the sales volume (units) which would be needed to accomplish a profit of Rs 12,000 in the period.

problem 2: A company manufactures and sells a single product. Budgeted costs for a period are below:

Rs per unit      Rs for the period

Direct materials                                     Rs 5.60
Direct labor                                           Rs 4.20
Variable production overhead                  Rs 0.70
Variable administration overhead             Rs 0.50
Fixed production overhead                                              78,000
Fixed administration overhead                                         42,000

If the absorption costing is used, the predetermined fixed production overhead absorption rate will be Rs 6.50 per unit based on budgeted production of 12,000 units.

Throughout the period 11,800 units of the product were manufactured. 12,300 units were sold at an average price of Rs 24 per unit. The actual costs in the period were as budgeted.

Required:

a) By using marginal costing, make a profit statement to exhibit the actual results for the period.

b) Compute and describe, the difference in profit for the period if absorption costing is used and why the profit figures be different (show workings clearly).

Cost Accounting, Accounting

• Category:- Cost Accounting
• Reference No.:- M96750

Have any Question?

## Related Questions in Cost Accounting

### Company expansion - internationallocate the financial

Company Expansion - International Locate the financial information for a company that has only domestic manufacturing operations. Assume management desires to expand into the global market with its current products. The ...

### Cost of capital assignment questions -1 what does the cost

Cost of Capital Assignment Questions - 1. What does the cost of capital represents? What is should reflect? 2. How do taxes affect the cost of debt? 3. What are the retained earnings? Do they have any costs for the firm? ...

### Instructionsnbspbull all questions carry equal marksbull

Instructions:   • All Questions carry equal marks. • All Questions are compulsory • All answers to be explained in not more than 1000 words for question 1 and 2 and for question 3in not more than 500 words for each subse ...

### Question 1 high-low methodtucson tractor inc has

Question 1 High-low method Tucson Tractor Inc. has accumulated the following data over a six month period   Indirect Labor Hours Indirect Labor Costs January......................... 400 \$ 6,000 February................. ...

### Case questions rio grande medical center cost allocation

CASE QUESTIONS RIO GRANDE MEDICAL CENTER Cost Allocation Concepts 1. Is it "fair" for the Dialysis Center to suffer in profitability, and hence for the department head to possibly lose his bonus, just because the Outpati ...

### Assignment discussion-cost accumulation systemwhen

Assignment: Discussion-Cost Accumulation System When companies accumulate costs, they generally use either a job-order or a process costing system. The type of system used often varies based on the type of product or ser ...

### Final project milestone three guidelinesoverview

Final Project Milestone Three Guidelines Overview: Classifying a company's costs allows for an in-depth analysis of the impact that changes in output have on revenues, costs, and net income or net loss. A cost-volume-pro ...

### Cost accountingquestion 1 which of the following statements

Cost Accounting Question 1. Which of the following statements regarding differential costs is (are) false? (A). The full cost fallacy occurs when a decision-maker fails to include fixed manufacturingoverhead in the produ ...

### Problem 1 master budgetomega inc has developed the

Problem 1: Master Budget Omega, Inc. has developed the following sales forecast for the first six months of the coming year Month Sales (in units) January 30,000 February 50,000 March 70,000 April 80,000 May 60,000 June ...

### Accounting assignmentmotorcade company has three service

Accounting Assignment Motorcade Company has three service departments (S1, S2, and S3) and two production departments (P1 and P2). The following data relate to Motorcade's allocation of service department costs:   Budget ...

• 4,153,160 Questions Asked
• 13,132 Experts
• 2,558,936 Questions Answered

## Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

### WalMart Identification of theory and critical discussion

Drawing on the prescribed text and/or relevant academic literature, produce a paper which discusses the nature of group

### Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

### Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

### Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

### Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro