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    Profit, Income, Sales Revenue, Ending Inventory, and Break-Even Point

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    Question 7: On Company and Off Company report the following results:

    Both companies increase sales next year by $500,000. Which company will have the higher profit next year?

    A Neither; both companies will have the same profit.
    B On will have higher profit ($100,000 greater than Off).
    C Off will have higher profit ($100,000 greater than On).
    D Off will have higher profit ($200,000 greater than On).

    Question 8:

    Assume that 500,000 CDs are produced and 450,000 are sold in 2008. What is income under Full Costing?

    A $50,000
    B $500,000
    C $150,000
    D $1,850,000

    Question 9: For O'Brien Company, selling price is $30 per unit and variable costs are $18 per unit. Fixed costs are $90,000. At the break-even point, O'Brien would report sales revenue of

    A $ 7,500.
    B $144,000.
    C $150,000.
    D $225,000.

    Question 10:

    Assume that 500,000 CDs are produced and 450,000 are sold in 2008. What is ending inventory under variable costing?

    A $150,000
    B $200,000
    C $250,000
    D $300,000

    Question 11: Last year, Bond Products had profits of $35,400. Sales of 70,800 units resulted in revenues of $354,000. Variable costs were $3.50 per unit. What is Bond's break-even point?

    A 70,800 units
    B 236,000 units
    C 47,200 units
    D 118,000 units

    Question 12: Randy Company produces a single product that is sold for $85 per unit. If variable costs per unit are $26 and fixed costs total $47,500, how many units must Randy sell in order to earn a profit of $100,000?

    A 1,735
    B 618
    C 890
    D 2,500

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    https://brainmass.com/business/inventory/283720

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    Question 7: On Company and Off Company report the following results:

    Both companies increase sales next year by $500,000. Which company will have the higher profit next year?

    A Neither; both companies will have the same profit.
    B On will have higher profit ($100,000 greater than Off).
    C Off will have higher profit ($100,000 greater than On).
    D Off will have higher profit ($200,000 greater than On).

    The company having lower Variable costs

    B) On will have higher profit ($100,000 greater than Off).

    Difference in Profit = Difference in CM ratio * Increase in ...

    Solution Summary

    This solution provides step-by-step calculations and answers for profit, income, sales revenue, ending inventory and break-even point.

    $2.19