Variable Cost Essay Examples

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Hsm260 Essay

281 words - 2 pages Fixed Costs, Variable Costs, and Break-Even Point 10.1 The highest meal minus the lowest meal = 4900-3500=1400 Highest cost minus the lowest cost= 26000-20500=5500 The variable cost could be the two answers from meals and cost divided by each other. Variable cost =5500/1400=$3.92857142857 or $3.93 Fixed cost is total cost-variable cost. So for July or the lowest meals and cost so 20500-(3500*3.93) so 3500*3.93=13755=20500-13755=6,745 Fixed cost 1 =6,745 To find BEP we need to know the formula which is Px=A+Bx So in 10.3 and 10.5 tables of the reading the price per unit is 5.77 so 5.77x=6,745+3.93x 5.77-3.93=6,745 (3.93-3.93) 1.84x=6745 1.84x/1.84x=6,745/1.84x X=3,666 monthly VIEW DOCUMENT
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Costing Methods Essay

377 words - 2 pages Polk Company to record a higher net income and is consistent with generally accepted accounting principles. Absorption and variable costing methods assist in the decision-making process and have advantages. Absorption costing includes manufacturing overhead costs up front versus variable costing where manufacturing overhead costs are a periodic expense. Variable accounting is consistent with cost-volume-profit (CVP); net income does not change with production levels, making it easier to see the impact fixed and variable costs have on net income. With variable costing, net income is tied to sales level, not production levels. The presentation of a variable cost income statement allows for VIEW DOCUMENT
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Solution Manual To Introduction To Management

2262 words - 10 pages | | |Variable expenses: | | | | |Cost of goods sold |89,520 |1,492 | | |(60 pianos × $1,492 per piano) | | | | |Delivery of pianos |3,660 |61 | | |(60 pianos × $61 per piano VIEW DOCUMENT
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Accounting Essay

540 words - 3 pages Profitability analysis framework Volume Revenues Price Profitability Fixed Costs Variable Terminology Revenue driver – any factor that causes a change in the total revenue of a product or service e.g. – volume of units sold, change in selling price how to measure volume? Differs by type of business – patient days for hospitals, “load” factor for airlines, sales per square feet for retailers Cost driver – any factor that causes a change in the total cost of a product or service e.g. - quality of materials, number of parts, skill of production workers, patients treated More Terminology Variable cost – cost that changes in total in direct proportion to changes of a cost driver (e.g VIEW DOCUMENT
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Salem Telephone Data Corp Essay

2617 words - 11 pages Table of Content Executive Summary 1 Background 2 Analysis 3 Recommendations 4 Appendix A- Summary of Computer Utilization 5 Appendix B- Summary Results of Operations, First Quarter 2004 6 Appendix C- Variable and Fixed Cost in respect to revenue hours 7 Appendix D- Breakdown of Variable Cost per Hour Usage 8 Appendix E- Contribution Margin Income Statement, March 2004 9 Appendix F- Contribution Margin Ratios 11 Appendix G- Break-even Analysis 12 Appendix H- “What if” Analysis 13 Executive Summary Since 2001, Salem Data Services has been operating at a net loss. After review the reports from first quarter 2004, it has become apparent that action will be necessary VIEW DOCUMENT
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Jhkl Essay

1177 words - 5 pages Case l6-1: Hospital Supply, Inc.* Approach The Hospital Supply case is placed in this chapter for those instructors who wish to expose students to alternative choice decisions and the related differential costing prior to getting into the details of full costing. Because in many programs the marketing and management accounting courses begin at the same time, this case also enables the accounting instructor to assist his or her colleagues in marketing by introducing break-even analysis at the start of the term; questions 1 and 4 can be used for this purpose. The case is also useful for giving students a good understanding of the fixed/variable cost dichotomy. In particular, I think it VIEW DOCUMENT
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Accounting Costs Essay

2018 words - 9 pages relevant for the activity of the organization. Cost Centre: A production or service / location, function, activity or item of equipment for which costs are accumulated. i) ii) iii) Cost Classification. Costs can be classified as Direct or Indirect i) ii) By Function iii) Fixed, variable or mixed (discussed under cost behavior) DIRECT OR INDIRECT: i) Direct Cost (Manufacturing Cost). Those that can be specifically and exclusively identified with a particular cost object. These costs comprises Direct Materials Direct Labour Direct Expenses N.B. Sometimes direct costs are treated as indirect because tracing them to the cost object directly is not cost effective. E.g the cost screws in a VIEW DOCUMENT
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Foundational 15 Chapter 5 Essay

1044 words - 5 pages only predict you will sell X amount of products at Y cost. The contribution income statement format helps in this process. In the traditional format, sales less cost of goods sold is gross margin. However, with this new format, sales less variable expenses is the contribution margin. The contribution margin is first used to cover fixed expenses and any remaining amount would become net operating income. [pic] Above is a C-V-P graph. This is a graphical depiction of how sales revenue, total expenses (variable expenses + fixed expenses) and fixed expenses relate over a range of sales volume. The more speakers sold the more revenue the greater the total expenses, but notice fixed expenses VIEW DOCUMENT
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Usefulness Of Cost Volume Profit Analyisi As Amangerial Concept

2473 words - 10 pages volume profit analysis , They find it an extremely useful measurement in a variety of ways . The present paper aimed to:    Increase the understanding of usefulness of CVP concept. Increase the understanding of budgets in business planning and performance evaluation. Looks at the effects on (net income) during the changes in such factors as variable cost , fixed costs , selling price , volume ,and mix of product sold .  Usefulness of CVP analysis as internal measurement tool in: Decision making, planning, performance evaluating, internal control, determining the feasibility of plan, risky indicator, indicate in the safer investment. INTRODUCTION: Accounting managers are responsible VIEW DOCUMENT
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Ac 505 Essay

584 words - 3 pages Jaylen Haynes AC 505 Professor Wright Case Study 2 5/20/12 Springfield Express is a luxury passenger carrier in Texas. All seats are first class, and the following data are available: Number of seats per passenger train car 90 Average load factor (percentage of seats filled) 70% Average full passenger fare $ 160 Average variable cost per passenger $ 70 Fixed operating cost per month $3,150,000 Formula : Revenue = Units Sold * Unit price VIEW DOCUMENT
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Ac 505 Case Study 2

570 words - 3 pages Springfield Express is a luxury passenger carrier in Texas. All seats are first class, and the following data are available: Number of seats per passenger train car 90 Average load factor (percentage of seats filled) 70% Average full passenger fare $160 Average variable cost per passenger $70 Fixed operating cost per month $3,150,000 a. What is the break-even point in passengers and revenues per month? b. What is the break-even point in number of passenger train cars per month? c. If Springfield Express raises its average passenger fare to $ 190, it is estimated that the average load factor will decrease to 60 percent. What will be the monthly break-even point in number of VIEW DOCUMENT
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Business Case Study

338 words - 2 pages ※ 繳交日期五月二十日下午五點前,逾期不計分 作業Ⅵ: The Healthy Spring Water company sells bottled water for offices and homes. The price of the water is $20 per 10 gallon bottle and the company currently sells 2000 bottles per day.  Following is the company's income and costs on a daily basis. Sales revenue $40,000 Incremental Variable cost $16,000 Nonincremental Fixed cost $20,000 [Note: you can assume that variable costs are constant so that the average of them is also the variable cost relevant for a change in sales.] The company is enjoying stable demand with its current pricing, but management is looking for ways to increase profitability. One suggestion is that the company reposition its VIEW DOCUMENT
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Profit Calculation

791 words - 4 pages The Basic Profit Equation: Cost-Volume-Profit analysis (CVP) relates the firm’s cost structure to sales volume and profitability. A formula that facilitates CVP analysis can be easily derived as follows: Profit = Sales – Expenses Profit = Sales – (Variable Costs + Fixed Costs) Profit + Fixed Costs = Sales – Variable Costs Profit + Fixed Costs = Units Sold x (Unit Sales Price – Unit Variable Cost) This formula is henceforth called the Basic Profit Equation and is abbreviated: P + FC = Q x (SP – VC) Contribution margin is defined as Sales – Variable Costs The unit contribution margin is defined as Unit Sales Price – Unit Variable Cost VIEW DOCUMENT
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Essay

507 words - 3 pages 3. Yes, in some situations, per unit variance is much more useful than the series of functional variances. Company can define the reasons of the variances much more clearly by calculating the per unit variance. And company can fix the problem by directly control the agency in charge. To analysis the variance, firstly we need to calculate the variable cost per unit of product. Using Exhibit 3(Total variable manufacturing costs) we can easily get the cost per unit of the products (Exhibit 4). From the exhibit, we can find out that all the actual cost per unit is higher than the standard ones which mean all the variances are unfavorable. Then we can calculate the exact number of price variance VIEW DOCUMENT
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Life Lessons

456 words - 2 pages ? Patients, Private Insurance, Medi-Cal, Medi-Care. 2. What types of centers (departments) have budgets? Research & Development 1. How many cost centers are there? Can you give some examples? Research: Study Patients, Study Rx, Study Patient Physician Consultants 1. How important is it to control costs? CRITICAL 1. How are fixed costs separated from variable costs? Fixed costs are paid regularly on a monthly, quarterly or annual basis. Variable costs require approval. 1. How are variable costs handled? They are VIEW DOCUMENT
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Microeconomics - Basics

1216 words - 5 pages a point beyond which the extra output from add. Units of factor will eventually diminish - output will eventually increase by a smaller amt - fixed factor will be used up - overcrowding FOP due to worsening factor combination FIXED COST - even if output is 0 TOTAL FIXED COST - sum of all COP that do not vary with level of output (overhead costs) AVERAGE FIXED COST - amt of fixed cost per unit o/p TOTAL VARIABLE COST - costs incurred for use of variable factors - e.g. cost of raw materials AVERAGE VARIABLE COST - total variable cost per unit of o/p - reaches min then rises - LDMR MARGINAL COST - additional cost incurred in producing an extra unit of output in VIEW DOCUMENT
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Transfer Prices

1287 words - 6 pages , however, illustrates potential problems with this TP method. The ABC company consists of two divisions: A and B. Division A's output is an intermediate product that is completed and marketed by the B division. The following cost and revenue information applies: Division A: Fixed Cost : $4000 Variable Cost : $2 per unit Division B: Fixed Cost : $3,000 Variable Cost : $10 per unit Each unit of the final product requires one unit of the intermediate product plus certain other inputs (provided by Division B) leading to a variable cost of 10. For the final product y Division B estimates that the market demand curve is VIEW DOCUMENT
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Case Study

1067 words - 5 pages more components and labors compared to other two products. Also, there are more variety in the types of flow controllers used in industry. Wilkerson raised flow controller prices by 10%, but there was no effect on demand. Wilkerson’s existing cost system is a simple cost accounting system. According to the case, the overhead costs were allocated to products as the percentage of direct labor cost. Each unit of product was charged for labor cost and direct material. In addition, variable costs for this company were only direct material and direct labor costs. The problem for this existing cost system that the company is inappropriately allocating overhead cost to products. Due to this VIEW DOCUMENT
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Operations Managegement

322 words - 2 pages to customers (what types of services would an anchor company provide to marine wholesalers?) Be sure to address all items in the list (above) and provide support for your conclusions. Question Two There are many ways that mushroom/bell anchors may be manufactured. Albatross Anchor is considering two new manufacturing processes (Process A and Process B) to reduce costs. From the available information below determine which process has the lowest breakeven point (this validates the process is more cost effective) and report your analysis and supporting conclusion. For each process the following fixed costs and variable costs are identified below: Anchor and Process Process A Process B VIEW DOCUMENT
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7-20 Case

985 words - 4 pages . Another important reason might be the company has poor management in the organization. Other Factors to Consider  Company reputation  Competitors’ information  Customer retention  Long-term sustainability and viability based on its current revenue and cost Recommendations In conclusion, the actual sales operating income does not equal to the budgeted sales operating income, because the mix of products sale changes significantly. It also causes the break-even point sales dollars increases. Moreover, I list several suggestions to Smithen Company about the products. First, I strongly recommend the company do not produce more mirrors than other two products, because the variable VIEW DOCUMENT
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Unit 7 P1

1511 words - 7 pages . Depreciation Depreciation is when the value of a certain item that the company owns decreases. For example: Depreciation cost = acquisition price (aanschaf waarde) – residual value : economic life. Depreciation cost are 302,500 (vat included) = (first calculate excl. vat) 362.500 : 121% x 100 = 250.000 Depreciation cost = 250000-50.000 : 20(year) = 10.000 B) Determine the cost price Chocolate: Normal production: 800.000,- Actual production: 690.000,- Fixed costs Cost price (cost + calculation method) Gather all fixed costs and variable costs. Fixed costs Lease cost = 30.000,- Rent cost = 120.000,- Insurance = 200.000,- Depreciation cost = 47.648,- (968.000 VIEW DOCUMENT
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Eco Week 2

898 words - 4 pages Learning Team Reflection: Production and Cost Analysis Heather Bosack, Iris Cost, Joey Piester, Jennifer Stephenson, and Girlean Taylor ECO/365 February 11, 2013 Jeffrey Lesson Learning Team Reflection: Production and Cost Analysis For our team there were many different experiences that were share in reference to the objectives for this week. Girlean explained that she understood that productivity is the amount of goods and services being produced and that the cost of production is the expenses that occur during production of those goods and services. She also explained that these expenses include fixed cost, variable cost and total cost. The team member shared that she works in VIEW DOCUMENT
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Chapter 20 Flash Cards

2250 words - 9 pages apply in the long run? → In the long run, firms can increase the availability of space and equipment to keep up with the increase in variable inputs. The MPP does not change in the long run. In the long run, firms have enough time to find the most qualified workers. All factors of production are fixed in the long run. | 20-7. The most desirable rate of output for a firm is the output that: Minimizes total costs. → Maximizes total profit. Minimizes marginal costs. Maximizes total revenue. | 20-8. The shape of the marginal cost curve reflects the: → Law of diminishing returns. Competitiveness of the firm. Law of diminishing marginal utility. Law of demand. | 20-9. If an VIEW DOCUMENT
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Term Papers

368 words - 2 pages Shrimps Production Ltd.is to select a machine out of two proposal PI and PII.The former is a semi automatic model requiring a fixed rental of Rs.3,000 p.a.and variable cost of production of Rs.1,000 p.a.and variable cost of production of Rs..0.25 perunit. The market demand has been showing fluctuation and probabilities of different demand levels have been put as follows: Demand | v.cost | Rental | Totalcost | Prob. | Expectedcost | 10,000 | 1,000 | 3,000 | 4,000 | 0.12 | 480 | 12,000 | 1,200 | 3,000 | 4,200 | 0.17 | 714 | 150,000 | 1,500 | 3,000 | 4,500 | 0.41 | 1,845 | 17,000 | 1,700 | 3,000 | 4,700 | 0.24 | 1,128 | 19,000 | 1,900 | 3,000 | 4,900 | 0.06 | 294 VIEW DOCUMENT
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Finance

874 words - 4 pages includes wages of production, electricity power to run machines, raw materials and the cost of maintaining inventory. These costs fluctuate depending on the activity of the business and should be controlled for the business to accrue profits. Various strategies can be employed to control variable costs (Bragg, 2011). Products and service provided need to be scrutinized in order to find out the most cost effective one. The costs can be reduced by reducing the production of products that provide least profits while at the same time investing in products that are more lucrative. For example, raw material can be scrutinized to find out the best sources that will be more cost effective in the VIEW DOCUMENT
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Mat540Wk2 Quiz

996 words - 4 pages | Correct Answer: |  False | | | | | Question 4 2 out of 2 points | | | Fixed cost is the difference between total cost and total variable cost.  Answer | | | | | Selected Answer: |  True | Correct Answer: |  True | | | | | Question 5 2 out of 2 points | | | The events in an experiment are mutually exclusive if only one can occur at a time.Answer | | | | | Selected Answer: |  True | Correct Answer: |  True | | | | | Question 6 2 out of 2 points | | | A binomial probability distribution indicates the probability of r successes in n trials.  Answer | | | | | Selected Answer: |  True | Correct Answer: |  True VIEW DOCUMENT
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Acc 256

2932 words - 12 pages in manufacturing. D. Sales commissions. Given the four costs: Factory depreciation Sales office utilities Presidents salary Property taxes on the factory Which of them would not be product costs? Factory depreciation, president’s salary, and property taxes on the factory. Sales office utilities, and president’s salary. Factory depreciation, and sales office utilities. Factory depreciation, and property taxes on the factory. The term relevant range means the range of activity over which: Relevant costs are incurred. Costs may fluctuate. Production may vary. The assumptions about fixed and variable cost behavior are reasonably valid. Variable costs: Increase on a per VIEW DOCUMENT
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Victor Cheng

317 words - 2 pages Customer Company Product Competition Who is the customer? - identify segments (segment size, growth rate, % of total market) - compare current year metrics to historical metrics (look for trends) What does each customer segment want? - identify keys needs What price is each segment willing to pay? - determine price points and price elasticity/sensitivity Distribution channel preference for each segment Customer concentration and power* (does one customer control all the demand, the "Wal-Mart" effect) Capabilities and expertise Distribution channels used Cost structure (mainly fixed vs. variable - is it better to have higher fixed cost with lower variable, or vice versa. High VIEW DOCUMENT
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Bill French Case

1479 words - 6 pages product emphasis V. ALTERNATIVE COURSES OF ACTION 1. Use Cost-volume-profit analysis in decision making. Advantage/s Disadvantage/s It is easy to understand. Mostly applicable only to business with single product It is easy to determine the sales amount—in either unit or revenue terms—that is required to cover total costs (both fixed and variable). 2. Determine the level of the company must operate in order to breakeven. Advantage/s Disadvantage/s Measure profit and loss at different levels of production and sales. Assumes production and sales are Predict the effect of changes in price of sales Time consuming to prepare. VI. CONCLUSION AND VIEW DOCUMENT
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His 135 Week 2 Discussion Question 2

370 words - 2 pages scenario? What is the regional manager’s ethical responsibility in this scenario? Explain and support your position with evidence from the text. Your initial post should be 200 to 250 words. Fixed and Variable Costs . (Chapter 1 Discussion Question 9(a)) Controller, Judy Koch, in a recent speech said, "I rarely see a real variable cost or a truly fixed cost." What did she mean? Include in your response an explanation of the difference in behavior of variable and fixed cost, including an ex Search for more tutorials here - https://bitly.com/1wySmvj Hunt for scholarships and keep hunting for scholarships. Do this even after you start college. There might be financial assistance possibilities that you do not discover until on campus. There might also be new opportunities that arise in your sophomore years and later, so always keep your eyes open for help. VIEW DOCUMENT
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Assignment

523 words - 3 pages , $63for product D. Product B's Mark up level is -30% which is less that 25% mark up level policy so CCI will discontinue production of B and increase production of D CCI's target is to get Maximum profit while selling at market price. Because of this below 25% mark on approach of CCI, there will be discontinuation happens of the products. Here CCI's existing accounting system is considering variable and fixed overhead into account along with direct material and direct labor in determining cost. If CCI kept its cost system but differentiated between variable and fixed cost and decided to maximize contribution then the variable cost will be $60, $17.5, $30 and VIEW DOCUMENT
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Analyzing Managerial Decision: Itunes Music Pricing

1551 words - 7 pages . With the recognition that music was being stolen, other ways were being developed by those with a stake in earning a profit. The industry had to decide if it should allow piracy to continue of develop variable pricing alternatives. This paper takes a look at alternative pricing in the case study, iTunes Music Pricing. At the conclusion, readers will have a better understanding of variable pricing policies.   Introduction Variable pricing represents a concept use, by Apple, to describe the structure of pricing to advertise downloadable data. Variable pricing involves the different cost of a product for based on the preferences of the producers. This varies from the model of flat pricing VIEW DOCUMENT
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Acct 505 Project B

420 words - 2 pages variable production costs per can $0.05 Costs to purchase cans—per can $0.45 Required rate of return 12% Tax rate 35% Make Purchase Cost to produce Annual cost of direct material: Need of 1.1 million cans per year $275,000 Annual cost of direct labor for new employees: Wages 72,000 Health benefits 7,500 Other benefits 12,960 Total wages and benefits 92,460 Other variable production costs 55,000 Total annual production costs $422,460 Annual cost to purchase cans $495,000 VIEW DOCUMENT
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Finance 370 Week 2

1077 words - 5 pages costs: RBF - Fixed costs = $5,000,000 $20,000,000 - fixed costs = $5,000,000 Fixed costs = $15,000,000 7) Find the selling price per unit, and the variable cost per unit: = $10 = $8 8) Compute the breakeven point: = 7,500,000 Units Question 15-13 A Allison Radios manufactures a complete line of radio and communication equipment for law enforcement agencies. The average selling price of its finished product is $180 per unit. The variable cost for these same units is $126. Allison Radios incurs fixed costs of $540,000 per year. a. What is the break-even point in units for the company? = 10,000 units b. What is the dollar sales volume the firm must VIEW DOCUMENT
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Unknown

5042 words - 21 pages  administrative offices 5) All of the following are true EXCEPT that indirect costs: A) may be included in prime costs C) are not easily traced to products or services B) vary with the selection of the cost object D) may be included in manufacturing overhead 6) If each motorcycle requires a belt that costs $20 and 2,000 motorcycles are produced for the month, the total cost for belts is: A) considered to be a direct fixed cost B) considered to be a direct variable cost C) considered to be an indirect variable cost D) considered to be an indirect fixed cost 7) A band of normal activity or volume in which specific cost-volume relationships are maintained is referred to as the: A) average range B VIEW DOCUMENT
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Financial Management

1309 words - 6 pages decisions. CVP analysis expands the use of information provided by breakeven analysis. A critical point of CVP analysis is the point where total revenues equal total costs (both fixed and variable costs). At this breakeven point (BEP), the company will experience no income or loss. CVP employs the same basic assumptions as in break-even analysis. CVP assumes: 1) Constant sales price, 2) Constant variable cost per unit, 3) Constant total fixed cost, 4) Constant sales mix, & 5) Units sold equal units produced. These are simplifying, largely linearizing assumptions, which are often implicitly assumed in elementary discussions of costs and profits. One of the main methods of calculating CVP is Profit VIEW DOCUMENT
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Bill French

287 words - 2 pages this increase should be allocated to this product. Production of Product A is to be scaled down, but as there isn't any information as to whether its relevant range of fixed costs will change, I have left its level of fixed costs unchanged. As a result both A's and B's break even points remain the same. For C the breakeven point is 354,545 units. The overall breakeven point is 1,035,686 units. b) Duo-Products must make a $1.2 million profit before tax to meet this requirement. To do this it must sell 1,372,494 units. c) An increase in variable costs across the board by 10% would increase the average variable cost to $3.72 per unit. For Duo-Products to break even under these conditions it would need to sell 1,144,440 units. d) Duo-Products would have to sell 1,516,615 units to meet both the extra dividends and expected union requirements. VIEW DOCUMENT
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Home Made

334 words - 2 pages Making any decisions in any company/business is very important; it can lead you into a success or a failure. From watching this video, which is about an accounting manager and a company Widget Pros, deciding whether or not this company should continue stay running in business. This video was straight to the point and has taught me a lot of things in a short period of time. First, it have taught me that a short term decision in a company can be made quickly by looking at contribution margin, net loss, relevant costs, fixed cost, and income. Second, I have learned that; to find a contribution margin, you can use the sale revenue and subtract the variable expense, to find a net loss, you can VIEW DOCUMENT
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Merger And Aqusition

1849 words - 8 pages 1 mark 26. Which of the above graphs best represents the cost of electricity where a fixed charge is paid for the supply and each unit of electricity used costs exactly the same amount? (a) Graph F (b) Graph E (c) Graph C (d) Graph B 1 mark 27.The following chart is a sketch of cost facing a manufacturing business. Is this cost: a) A total fixed cost; b) A total variable cost; c) A semi variable cost; d) A stepped fixed cost; 1 mark 28. In a manufacturing business which of the following will be classed as a fixed cost: a) Raw materials; b) Interest on long term loans; c) Direct labour costs; d) Packaging VIEW DOCUMENT
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Assignment 1

1118 words - 5 pages cover the cost plus some of the amount of profit that could be made. For example most often it is used in the military and in the government contractors where the risk is put on the vendor instead. That is why Diamond Dynamics is more focused on having a forecasted approach of a cost-price contract where we are paid for all of the allowed expenses for a set limit and an additional payment to allow for profit. I think that this way is a lot better then the fixed-price contract and I think that it would also benefit out company in a good way in the future. Now in the start-up phase of this company there well be a few cost that well happen. Some of the costs are semi-variable, allocated VIEW DOCUMENT
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Cost-Volume-Profit (Cvp) Analysis

432 words - 2 pages attain targeted income levels.” The break-even point according to W.D Adkins (2015) is, “the point at which revenues are just enough to cover expenses so there in no profit and no loss.” For instance Calculating Breaking-Even Analysis There are many steps in finding the break even analysis. According to Zari Ballard of Ehow (2015, ), First, calculate the total fixed costs by adding together each of the company's fixed costs. For example, a small company with annual fixed costs of $7,000 in rental payments, $3,000 in equipment leases and $30,000 in administrative salaries would have TFC of $40,000. Next, calculate the contribution margin per unit by subtracting the variable cost per VIEW DOCUMENT
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Elder Services

627 words - 3 pages $100 000 $150 000 $300 000 Revenues Variable cost 30 000 50 000 120 000 200 000 (labour &supplies) Variable 5 000 2 000 5 000# 12 000 transportation Fixed 5 000 10 000 15 000 Transportation* Fixed costs (other)% 4 000 8 000 12 000 24 000 Allocated HQ cost 10 000 20 000 30 000 60 000 $54 000 $90 000 $167 000 $311 000 Total expenses ($4 000) $10 000 ($17 000) ($11 000) Surplus/(Deficit) #Nurses use their cars. *Fixed costs transportation are allocated based on the number of vehicles %Fixed costs (other) are allocated based on revenue. Note: Variable costs are direct costs for each department. In the past, the Federal Government also provided small grants each year to cover any losses for Elder VIEW DOCUMENT
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Economics

653 words - 3 pages (on month basis) | 2000 | Total | 101000 | VARIABLE COST variable costs | Amount | food & material | 50,000.00 | I would be the manager myself and will look after the restaurant. CALCULATION OF BREAK EVEN POINT   | PARTICULARS | AMOUNT |   | SALES | 195000 | LESS | VARIABLE COST | 50000 |   |   |   |   | CONTRIBUTION | 145000 |   |   |   | LESS | FIXED EXPENSES | 101000 |   | PROFIT | 44000 | I have assumed sales of rs. 6500 on a regular basis BEP(IN VALUE)= FIXED COST PV RATIO =1,35,828 rs. This shows that I have to make minimum VIEW DOCUMENT
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Seligram Case

581 words - 3 pages Trang Phung MPA 527 Professor Duran Seligram Case 1. What caused the existing accounting system at ETO to fail? * It is because of the single cost pool accounting system. * In the single cost pool system, all products consume direct labor and overhead in the same proportion. However, some products need more DL whiles other requires more automated machinery operation. * The trends of DL obsolescence also biased the calculation of burden rate, which causes the overall product costs assessment become misleading. 2. Calculate the reported costs of the five components described in the case using: a. The existing system- burden rate = 145% Burden rate 145 VIEW DOCUMENT
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Case Study

486 words - 2 pages analysis is used to determine the break-even point of the business in addition to provides a great help to managers and other business professionals to make short term economic decisions. CVP analysis provides managers with the advantage of being able to answer specific realistic questions needed in business analysis. However, a good understanding of variable and fixed costs provides the organization with a clear view of how it can make a profit using CVP analysis. The basic CVP concept is that the difference or margin between sales and variable cost must first be used to cover fixed costs. Once the organization achieves that breakeven point, then the remaining margin becomes profit. Questions VIEW DOCUMENT
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Explicit Costs And Implicit Costs Concepts

1552 words - 7 pages it will be depends on the particular relationship between its revenues and costs. It is not necessary for the firm to be covering all its costs for it to operate at its best possible output level. In the short run a firm may continue to operate even if it has a loss at this best possible output. Whether there are profits or losses or the firm just breaks even depends on its overall cost structure, how high or low its average variable and average total costs are relative to the prevailing market price for its product.  So long as the firm is able to cover its average variable costs when it sets output so as to equate marginal cost and marginal revenue it will probably be willing to stay in VIEW DOCUMENT
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Quantitative Methods

1752 words - 8 pages unit standard cost can be used to value goods transferred out and EWIP. Thus, all that is needed are the physical flow schedule and the FIFO equivalent units schedule. Comp. Prob. 2 (Continued) 7. a. and b. Fixed overhead variances: *0.50 × $1,150,000 c. and d. Variable overhead variances: *0.50 × $1,150,000 8. a. Sales budget: Units (3,000 + 2,000) 5,000 Selling price x 400 Sales 2,000,000 b. Production budget: Unit sales 5,000 Desired ending inventory 1,000 Total needed 6,000 Less: Beginning inventory 500 VIEW DOCUMENT
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Business Marketing

694 words - 3 pages net marketing contribution as a result of this action? Show your work. a) an increase of 12.5% b) a decrease of 20% c) a decrease of 17% d) no net change in net marketing contribution e) not enough information to determine the impact on net marketing contribution f) 18 Total Demand $1,000,000.00 g) 19 Market Share 0.4 h) 20 Average Selling Price/case $100.00 i) 21 Variable Selling Price/case $70.00 j) 22 Marketing&Sales Expense $60,000.00 $60,000.00 =(D18*D19)*0.15 k) 23 l) 24 Sales Revenue $40,000,000.00 D18*D19*D20 m) 25 Cost of Goods Sold $28,000,000.00 =D18*D19*D21 n) 26 Percent Margin 0.30 =(E24-E25)/E24 o) 27 Net Marketing Contribution (NMC) $11,940,000.00 VIEW DOCUMENT
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Acc 350 Exam 1 Practice

651 words - 3 pages . Refer to Figure 2-11. The variable product costs are a. | $ 969,000 | b. | $ 769,000 | c. | $ 764,000 | d. | $1,179,000 | 5. Refer to Figure 2-11. The total product cost is a. | $1,179,000 | b. | $ 969,000 | c. | $ 615,000 | d. | $ 764,000 | Inventory balances for Spiritlight Ventures for November 2014 are as follows: | November 1, 2014 | November 30, 2014 | Materials | $ 9,000 | $ 7,000 | Work in process | 16,000 | 12,400 | Finished goods | 36,000 | 30,000 | During November, purchases of direct materials were $18,000. Direct labor and factory overhead costs were $20,000 and $28,000, respectively. 6. The cost of goods manufactured in VIEW DOCUMENT
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Term Paper

3672 words - 15 pages branches.    These rules are shown in Figure 13, where branch A is used as source branch/plant, updating the sales/inventory value to cost method 05 of the other branches. Copyright © 2012 by Klee Associates, Inc. www.JDEtips.com Page 8 Product Costing - Best Practices Figure 13: Cost Branch Update Overview The unit cost of an item is defined in the base currency of the company, defined by the used branch/plant. Defining a source and a destination branch/plant makes it possible to check both base currencies. The extra variable for defining an exchange rate is a reference date. Standard "today's date" will be used by default, but in order to prepare future costs VIEW DOCUMENT