Solutions for Cost Analysis for Engineers and Scientists, 1st Edition by Tayyari (All Chapters included)
4 views 0 purchase
Course
Cost Analysis for Engineers and Scientists 1e
Institution
Cost Analysis For Engineers And Scientists 1e
Complete Solutions Manual for Cost Analysis for Engineers and Scientists, 1st Edition by Fariborz Tayyari ; ISBN13: 9781032147116...(Full Chapters are included and organized in revere order from Chapter 7 to 1)...1. Accounting and Cost Information Systems.
2. Cost Analysis Fundamentals.
3. Produ...
Cost Analysis for Engineers and
Scientists, 1st Edition by
Fariborz Tayyari
Complete Chapter Solutions Manual
are included (Ch 1 to 7)
** Immediate Download
** Swift Response
** All Chapters included
,Table of Contents are given below
1. Accounting and Cost Information
Systems.
2. Cost Analysis Fundamentals.
3. Product Costing.
4. Manufacturing Cost Allocation
5. Joint Cost Allocation
6. Estimating Cost Functions
7. Cost-Volume-Profit Analysis
,The Solutions Manual are organized in reverse order, with the last chapter displayed first, to ensure
that all chapters are included in this document. (Complete Chapters included Ch7-1)
COST ANALYSIS for Engineering and Scientists Chapter 7 Solutions
Chapter 7: Cost-Volume-Profit Analysis
Review Questions: Answers
R7.1 Answer
1) volume or level of activity,
2) unit selling prices,
3) variable cost per unit,
4) fixed costs.
R7.2. The CVP income statement classifies costs as variable or fixed.
R7.3. The contribution margin ratio is the difference between the sales price and the variable
cost of product divided by the sales price and expressed in a percentage of sales.
It is useful in planning business operations as it is a key component of the cost-volume-
profit analysis to examine the effects of changes in sales volumes, sales prices, and costs
on the profit of a business.
R7.4. The breakeven point can be calculated by.
- Graphical method as the intersection of the revenue curve and the total cost curve;
- Setting total revenue equal to total costs;
- Setting the CVP equation equal to zero.
R7.5. Breakeven Quantity = Fixed Costs / Contribution Margin Per Unit
QBE = F / (P – V)
R7.6. Breakeven Sales Dollars = Fixed Costs / Contribution Margin Ratio
BE Sales $ = F / CMR
R7.8 Margin of safety is the difference between actual (or expected) sales and sales at the
breakeven point.
The formulas for margin of safety are:
- Margin of Safety in Dollars = Actual (Expected) Sales - Breakeven Sales
and
- Margin of Safety Ratio = (Margin of Safety in Dollars) / [Actual (Expected) Sales].
7S-1
, COST ANALYSIS for Engineering and Scientists Chapter 7 Solutions
R7.9 The sales mix is the relative proportion in which each product is sold when a company
sells two or more different products.
For a multi-product company, breakeven sales in units is determined by using the
weighted-average unit contribution margin of all the products.
R7.10. The contribution margin is the difference between the revenue and variable costs. The
contribution margin is the portion of revenue available to cover the company's fixed
costs. The contribution margin is an important factor to consider when determining a
company's breakeven point. It is computed using the following formula:
Contribution Margin = Revenue − Variable Costs
The margin of safety is the difference between the actual (estimated) sales and the
breakeven sales. It is a measure of the extent to which the sales can drop before a firm
incurs a loss. It is computed using the following formula:
Margin of Safety = Actual Sales − Breakeven Sales
R7.11. Gross Profits = Sales Revenues Less Costs of Goods Sold.
Gross Profits Less Operating Expenses (Selling, Administrative, Depreciation)
= Operating Profits
[Operating Profits] plus [Miscellaneous Income (royalties, interest income, capital
gains)] less [Miscellaneous Expenses (interest expense) and Income Taxes]
= Net Profit.
Sales Revenue xxx
Less: Cost of Goods Sold (xxx)
Gross Profit xxx
Less: Operating Expenses
Selling Expenses xxx
Administrative Expenses xxx
Depreciation Expense xxx
Total Operating Expenses (xxx)
Operating Income (Profit) xxx
Add: Misc. Income (Royalties, Capital Gains &
Earned Interests and Dividends) xxx
Less: Interest Expense and Fees (xxx)
Net Income, Before Income Taxes xxx
Income Taxes (xxx)
Profit (Net Income) xxx
R7.12. Within the relevant range, the break-even point does not change. This is due to the linearity
assumptions that apply to total revenues, fixed costs, and variable costs.
R7.13. The margin of safety gives decision-makers an idea of the extent to which sales can fall before
operations will become unprofitable.
7S-2
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller mizhouubcca. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $29.49. You're not tied to anything after your purchase.
