QUESTION 4 Chase Company has provided the tellowing data Bales 6,000 units xed c

Question

QUESTION 4 Chase Company has provided the tellowing data Bales 6,000 units xed cost 300,000 S100 per unit ariable cost margin unit is ncreased by 10%, total fixed cost is decreased by 20%, and al other factors remain the same, net income wilt O decrease by $60,000. O increase by $60,000. O increase by $120.000 O increase by $420,000 QUESTION 5 The following is Aykroyd Corporation's contribution format incone statement for last month Sales Less variable expenses $4,000 1 200,00 Less fixed expenses The company has no beginning or ending inventories A total of 80,000 units were produced and sold last month, (Note that this is the same data provided for the question ) What is the company's break-even in units? ?0 units 0 48,000 units O 72,000 units 80,000 units

Explanation / Answer

4. Answer is option C $120,000

Increase in contribution (6000*100*10%) = 60000

+ Decrease in fixed cost (300000*20%) = 60000

Increase in net income = 120000

5. Answer is option B 48,000 units

Selling price per unit = 4000000/80000 = 50

Variable expense per unit = 2800000/80000 = 35

Contribution margin Per unit = 50-35 =15

Breakeven point in units = fixed expense / contribution margin Per unit = 720000/15 = 48000 units

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