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).