Student Name:Class:

Problem 18-02A

EDGE EQUIPMENT CO.

Break-even in sales units:

Fixed costs Contribution margin per unit Break-even point in units:

Break-even in sales dollars:

Fixed costs Contribution margin ratio Break-even point in sales dollars:

EDGE EQUIPMENT CO.Contribution Margin Income Statement

(at Break-Even) Product XT

SalesVariable costsContribution marginFixed costsNet income

Given Data P18-02A:

EDGE EQUIPMENT CO.

Selling price per 100 yards $ 150 Fixed costs $ 200,000 Maximum capacity in yards 550,000 Forecasted variable costs per 100 yards $ 100

Check figures:(1) Break-even sales units 4,000

Student Name:Class:

Problem 18-06A

CAIRO COMPANYComputation of Break-Even

New variable costs and expenses for both Plans: Materials costs Direct labor cost Overhead variable costs Selling and admin. costs Total variable costs

Plan 1: Selling price Contribution margin Contribution margin ratio Total fixed costs Break-even (dollars)

Plan 2: Selling price Contribution margin Contribution margin ratio Total fixed costs Break-even (dollars)

CAIRO COMPANYForecasted Contribution Margin Income Statement

Plan 1 Plan 2

Total Total Per Unit Units Per Unit Units

SalesVariable costsContribution marginFixed costsIncome before taxesIncome taxesNet income

Given Data P18-06A:

CAIRO COMPANY

Units sold 35,000 Price per unit $ 16 Fixed manufacturing costs $ 120,000 Fixed selling and admin. expenses $ 180,000 Variable costs per unit: Material $ 4.00 Direct labor $ 3.00 Variable overhead costs $ 0.40 Variable selling and admin. expenses $ 0.20 Cost decreases using new material: Material costs 60% Direct labor costs 40%Factory capacity in units 40,000 Plan 1: Price and sales levels do not changePlan 2: Price increase 25% Unit sales volume decrease 10%Income tax rate 30%

Check figure:(1) Break-even: Plan 1 $ 400,000 Break-even: Plan 2 $ 375,000 (2) Net income: Plan 1 $ 84,000 Net income: Plan 2 $ 142,800