Sunland Copy & Printing wants to predict copy machine repair expense at different levels of copying activity (number of copies made)

Sunland Copy & Printing wants to predict copy machine repair expense at different levels of copying activity (number of copies made).

QUESTION 1

Sunland Copy & Printing wants to predict copy machine repair expense at different levels of copying activity (number of copies made). The following data have been gathered:

Copy Machine
MonthRepair ExpenseCopies Made
May$21,260302,000
June35,740560,000
July56,300886,000
August48,460772,000
September25,200376,000



Determine the fixed and variable components of repair expense using the high-low method. Use copies made as the measure of activity. (Round variable component per copy to 2 decimal places, e.g. 0.15.)

Variable Component$enter a dollar amount per copy rounded to 2 decimal places per copy
Fixed Component$enter a dollar amount per month rounded to 0 decimal places per month

QUESTION 2

Current Attempt in Progress


Carla has estimated that fixed costs per month are $347,276 and variable cost per dollar of sales is $0.32.

What is the break-even point per month in sales dollars?

Break-even point$enter break-even point per month in dollars 

What level of sales dollars is needed for a monthly profit of $33,388?

Sales$enter sales in dollars 

For the month of July, the marina anticipates sales of $980,700. What is the expected level of profit?

Expected level of profit$enter expected level of profit in dollars 

QUESTION 3

Headland, Inc. produces stereo speakers. The selling price per pair of speakers is $1,000. The variable cost of production is $370and the fixed cost per month is $43,344. For November, the company expects to sell 128 pairs of speakers.

Calculate expected profit.

Expected profit$enter expected profit in dollars 

Calculate the contribution margin ratio, Break-even sales, Expected sales and margin of safety in dollars. (Round contribution margin ratio and intermediate calculations to 2 decimal places, e.g. 15.25 and all other answers to 0 decimal places, e.g. 5,275.)

Contribution margin ratioenter contribution margin ratio rounded to 2 decimal places
Break-even sales$enter break-even sales in dollars rounded to 0 decimal places 
Expected sales$enter expected sales in dollars rounded to 0 decimal places 
Margin of safety$enter margin of safety in dollars rounded to 0 decimal places 

QUESTION 4

Uli Manufacturing produces snow shovels. The selling price per snow shovel is $30.00. There is no beginning inventory.

Costs involved in production are:
Direct material$5.00
Direct labor4.00
Variable manufacturing overhead4.00
Total variable manufacturing costs per unit$13.00
Fixed manufacturing overhead per year$177,840


In addition, the company has fixed selling and administrative costs of $172,200 per year.

During the year, Uli produces 49,400 snow shovels and sells 44,320 snow shovels.

A) What is the value of ending inventory using full costing?

B) What is the value of ending inventory using variable costing?

C) Calculate the difference in full costing net income and variable costing net income without preparing either income statement.

D) What is the cost of goods sold using full costing?

E) What is the variable cost of goods sold?

F) What is net income using full costing?

G) What is net income using variable costing?

H) How much fixed manufacturing overhead is in ending inventory under full costing? Compare this amount to the difference in the net incomes calculated in “C” above.

Sunland Copy & Printing wants to predict copy machine repair expense at different levels of copying activity (number of copies made)

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