Exercise 11-5 Fixed versus variable cost behavior
Nasenko Company’s cost and production data for two recent months included the following:
- Separately calculate the rental cost per unit and the utilities cost per unit for both March and April.
- Identify which cost is variable and which is fixed. Explain your answer.
Exercise 11-17 Break-even point
Agassi Corporation sells products for $90 each that have variable costs of $60 per unit. Agassi’s annual fixed cost is $450,000.
Determine the break-even point in units and dollars.
Exercise 11-18 Desired profit
Lindo Company incurs annual fixed costs of $80,000. Variable costs for Lindo’s product are $40 per unit, and the sales price is $64 per unit. Lindo desires to earn an annual profit of $40,000.
Determine the sales volume in dollars and units required to earn the desired profit.