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Cost Management: A Strategic Emphasis 7th Edition by Edward Blocher,David Stout ,Paul Juras,Gary Cokins
Edition 7ISBN: 978-0077733773Cost Management: A Strategic Emphasis 7th Edition by Edward Blocher,David Stout ,Paul Juras,Gary Cokins
Edition 7ISBN: 978-0077733773 Exercise 47
CVP Analysis; ABC Costing Using the information in Problem 9-46, complete the following:
Required
1. Compute the breakeven point in units for both the current and the proposed manufacturing plans, assuming that total setup costs vary with the number of batches and that the batch size is fixed (other than for the last batch, in most cases). Assume that setup costs are the only costs that vary with the number of batches.
2. As a check on your calculations in requirement 1, prepare a contribution income statement at the exact breakeven point for both the current plan and the proposed plan.
3. Compare your solution in requirement 2 to that for Problem 9-46 and interpret the difference.
Required
1. Compute the breakeven point in units for both the current and the proposed manufacturing plans, assuming that total setup costs vary with the number of batches and that the batch size is fixed (other than for the last batch, in most cases). Assume that setup costs are the only costs that vary with the number of batches.
2. As a check on your calculations in requirement 1, prepare a contribution income statement at the exact breakeven point for both the current plan and the proposed plan.
3. Compare your solution in requirement 2 to that for Problem 9-46 and interpret the difference.
Explanation
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Cost Management: A Strategic Emphasis 7th Edition by Edward Blocher,David Stout ,Paul Juras,Gary Cokins
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