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vitfil [10]
3 years ago
14

Gabe Industries sells two​ products, Basic models and Deluxe models. Basic models sell for $ 44 per unit with variable costs of

$ 25 per unit. Deluxe models sell for $ 52 per unit with variable costs of $ 25 per unit. Total fixed costs for the company are $ 1 comma 323.00. Gabe Industries typically sells three Basic models for every Deluxe model.
What is the breakeven point in total​ units?
a. 50 units
b. 63 units.
c. 29 units.
d.32 units
Business
1 answer:
12345 [234]3 years ago
4 0

Answer:

The correct answer is B.

Explanation:

Giving the following information:

Basic models sell for $ 44 per unit with variable costs of $ 25 per unit. Deluxe models sell for $ 52 per unit with variable costs of $ 25 per unit. Total fixed costs for the company are $1,323. Gabe Industries typically sells three Basic models for every Deluxe model.

First, we need to calculate the weighted sales participation:

Basic= 3/4= 0.75

Deluxe= 1/4= 0.25

Now, we need to calculate the weighted average selling price and variable cost:

weighted average selling price= (selling price* weighted sales participation)= (44*0.75 + 52*0.25)= 46

weighted average variable cost= (variable cost* weighted sales participation)= (25*0.75 + 25*0.25)= 25

Now, we can calculate the break-even point in units:

Break-even point (units)= Total fixed costs / (weighted average selling price - weighted average variable expense)

Break-even point= 1,323/ (46 - 25)= 63 units

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Explanation:

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Sales and purchase-related transactions using perpetual inventory system The following were selected from among the transactions
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Answer:

July 3. Purchased merchandise on account from Hamling Co., list price $85,000, trade discount 25%, terms FOB shipping point, 2/10, n/30, with prepaid freight of $960 added to the invoice.

Dr Merchandise inventory 63,435

    Cr Accounts payable 63,435

July 5. Purchased merchandise on account from Kester Co., $47,550, terms FOB destination, 2/10, n/30.

Dr Merchandise inventory 46,599

    Cr Accounts payable 46,599

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Dr Accounts receivable 16,680

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Dr Cost of goods sold 9,440

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July 7. Returned merchandise with an invoice amount of $13,500 purchased on July 5 from Kester Co.

Dr Accounts payable 13,230

    Cr Merchandise inventory 13,230

July 13. Paid Hamling Co. on account for purchase of July 3.

Dr Accounts payable 63,435

    Cr Cash 63,435

July 15. Paid Kester Co. on account for purchase of July 5, less return of July 7.

Dr Accounts payable 33,369

    Cr Cash 33,369

July 21. Received cash on account from sale of July 6 to Parsley Co.

Dr Cash 16,680

    Cr Accounts receivable 16,680

July 21. Sold merchandise on MasterCard, $212,670. The cost of the goods sold was $144,350.

Dr Cash (assuming MasterCard pays immediately) 212,670

    Cr Sales revenue 212,670

Dr MasterCard fee expense 3,510

    Cr MasterCard fee payable 3,510

Dr Cost of goods sold 144,350

    Cr Merchandise inventory 144,350

I recorded the transaction this way because on July 31, a payment to MasterCard is recorded. Generally the transaction should have been recorded differently since MasterCard withholds its fee automatically, you do not pay it.

Dr Cash (assuming MasterCard pays immediately) 209,160

Dr MasterCard fee expense 3,510

    Cr Sales revenue 212,670

 

July 22. Sold merchandise on account to Tabor Co., $60,200, terms 2/10, n/30. The cost of the goods sold was $33,820.

Dr Accounts receivable 58,996

    Cr Sales revenue 58,996

Dr Cost of goods sold 33,820

    Cr Merchandise inventory 33,820

July 23. Sold merchandise for cash, $38,610. The cost of the goods sold was $22,180.

Dr Cash 38,610

    Cr Sales revenue 38,610

Dr Cost of goods sold 22,180

    Cr Merchandise inventory 22,180

July 28. Paid Parsley Co. a cash refund of $6,070 for returned merchandise from sale of July 6.  The cost of the returned merchandise was $3,630.

Dr Sales revenue 6,070

    Cr Cash 6,070

Dr Merchandise inventory 3,630

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Dr MasterCard fee payable 3,510

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Answer:

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Explanation:

As with the details of inventory we have:

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Purchases = $100,000

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Therefore, cost of goods sold = Total inventory - Closing

= $150,000 - $110,000 = $40,000

Cost of goods sold is an expense, and shall be debited.

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