Question 1. XYZ had sales of $19,000 (95 units at $200 each). Manufacturing costs consisted of direct labor $2,500, direct materials $2,600, variable factory overhead $3,600 and fixed factory overhead $800. Selling expenses totaled $4,900 ($1,200 variable and $3,700 fixed) and administrative expenses totaled $4,700 ($1,100 variable and $3,600 fixed)
a. What is the breakeven point in units?
b. What is the breakeven point in dollars?
c. What is the breakeven point in dollars if XYZ wants to achieve $12,000 net income?
Question 2. The following is selected information from Reliant Company for the fiscal years ended December 31, 2017:
Reliant Company had net income of $682,000
Depreciation was $37,000
Interest payable increased by $7,000
Purchases of equipment were $120,000
Accounts receivable decreased by $34,000
Bonds payable issued were $50,000
Accounts payable increased by $18,000
Disposals of equipment for $86,000 resulted in a $7,400 gain
Prepaid expenses increased by $24,000
Dividends of $15,000 were paid to shareholders; and
Cash balance on January 1, 2017 was $225,000.
a. What was the net cash flows from operating activities?
b. What was the net cash flows from investing activities?
c. What was the net cash flows from financing activities?
d. What was the net increase/(decrease) in cash?