gefer to Figure 1 to answer Questions 29. Figure1 Cost-Volume-Profit Graph $100,

Question

gefer to Figure 1 to answer Questions 29. Figure1 Cost-Volume-Profit Graph $100,000 80,000 60,000 40,000 f 20,000 1,000 2,000 3, 3,000 4,000 5,000 Units 29. The slope of line b above is equal to the: A. Contribution margin per unit B. Fixed cost per unit C. Selling price per unit D. Variable cost per unit E. Degree of operating leverage Use the following information to answer Question 30. EzeeKleen makes two cleaning products: Sheen and Shine. Financial information from the previous year is shown below: Units produced and sold Machine hours used Selling price per unit Variable cost per unit 5,000 5,000 $7 $4 Shine 4,000 2,000 $10 $8 EzeeKleen has 10,000 machine hours available. Maximum market demand is 16,000 units for each product. How many units of each product should be produced and sold in order to maximize contribution margin? 30. A. B. 2,000 C. 3,000 D. 10,000 E. 16,000 Shine 10,000 16,000 16.000

Explanation / Answer

Q29. Answer is D. variable cost per unit. Q30. Sheen Shine Selling price 7 10 Less: Variable cost 4.00 8.00 Contirbution per unit 3 2 Machine hours (Total MH/ Units) 1 0.5 Contribution per MH 3 4 Ranking II I Total Machine hours 10000 Less: utilized in Shine 8000 (16000 units *0.50) (16000 units @0.50 hour) Available for Sheen 2000 Numberof units of Sheen 2000 (2000 hours/ 1 hr) Answer is B. Product Sheen: 2000 units Product Shine: 16000 units

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