With the class divided into groups , answer the following . ( a )
Calculate the estimated break-even point in annual unit sales of the new product if Creative Ideas Company uses the : ( 1 ) Capital-intensive manufacturing method . ( 2 ) Labor-intensive manufacturing method .
( b )
Determine the annual unit sales volume at which Creative Ideas Company would be indifferent between the two manufacturing methods .
Brief Exercise 19-16
The Rock Company produces basketballs . It incurred the following costs during the year . What are the total product costs for the company under variable costing ?
Exercise 19-7 PDQ Repairs has 200 auto-maintenance service outlets nationwide . It performs primarily two lines of service : oil changes and brake repair . Oil change – related services represent 70 % of its sales and provide a contribution margin ratio of 20 %. Brake repair represents 30 % of its sales and provides a 40 % contribution margin ratio . The company ’ s fixed costs are $ 15,620,000 ( that is , $ 78,100 per service outlet ).