QUESTION 1

Polka Dots, Inc. manufactures polka dot dresses which sell for $50 each. The firm expects to sell 90,000 dresses next year. At this level of sales, variable expenses will total $922,500 and fixed expenses will total $596,250. What amount of dollar sales is needed next year for Polka Dots to breakeven?
$4,000,000
$750,000
$3,750,000
$900,000

QUESTION 2
Polka Dots, Inc. manufactures polka dot dresses which sell for $50 each. The firm expects to sell 90,000 dresses next year. At this level of sales, variable expenses will total $922,500 and fixed expenses will total $596,250. If Polka Dots wants to make $198,750 in profit next year, what will total sales in dollars have to be next year?
$1,000,000
$1,717,500
$795,000
$900,000

QUESTION 3
Pencil Pushers, Inc. manufactures a "Silly Pencil" which sells for $7.50 each. Pencil Pushers expects to sell 82,000 silly pencils next year. At this level of sales, variable expenses will total $184,500 and fixed expenses will total $242,130. The marketing department forecasts that sales of silly pencils will increase 40% next year if Pencil Pushers increases the yearly advertising budget by $10,000 and redesigns a new package for the silly pencil that would increase packing costs by $1 per unit. If these changes are made, what would be the new projected net operating income?
$424,370
$235,770
$861,000
$487,900

QUESTION 4

Arash Company uses a predetermined overhead rate of $16 per direct labor hour. Estimated direct labor hours at the beginning of the year were 8,500 and actual direct labor hours at the end of the year were 8,800. Estimated total manufacturing overhead costs at the beginning of the year are $136,000 and actual total manufacturing overhead costs at the end of the year are $149,000. What is the amount of manufacturing overhead that would have been applied to all jobs during the year?
$143,920
$131,364
$140,800
$149,000