Richland Enterprises has budgeted the following amounts for its next fiscal year: Total fixed expenses $53,000 Selling price per unit $65 Variable expenses per unit $35 If Richland Enterprises can reduce fixed expenses by $18,870, how will breakeven sales in units be affected?
A) Decrease by 629 units
B) Increase by 189 units
C) Increase by 629 units
D) Decrease by 189 units
Answer: A) Decrease by 629 units
Sales $65
Less Variable expenses 35
Contribution Margin $30
18,870/$30 CM = 629 decrease in Break Even units
You might also like to view...
Which of the following eliminates trade barriers to allow the harmonization of economic, social, and regulatory policies?
A) a customs union B) a common market C) a free trade area D) an economic union
Which of the following is NOT true about ratio-scaled data?
A) The origin of the scale is fixed. B) Such data can be transformed by using y = bx. C) All statistical techniques can be applied to such data. D) Common examples include height and weight. E) They can be transformed using y = a + bx.
Describe the four types of "exceptions" listed in the chapter
What will be an ideal response?
The NPV method assumes that cash flows are reinvested at:
A) the government's prime rate. B) the internal rate of return. C) the company's discount rate. D) an average of the internal rate of return and the discount rate.