The Metal Shop produces 1.8 million metal fasteners a year for industrial use. At this level of production

The Coffee Express has computed its fixed costs to be $0.34 for every cup of coffee it sells given annual sales of 212,000 cups. The sales price is $1.49 per cup while the variable cost per cup is $0.63. How many cups of coffee must it sell to break-even on a cash basis?    A.  83,814 B.  96,470 C.  123,910 D.  167,630 E.  212,000 Qcash break-even = ($0.34 × 212,000)/($1.49 - $0.63) = 83,814 cups

75.

The Metal Shop produces 1.8 million metal fasteners a year for industrial use. At this level of production, its total fixed costs are $320,000 and its total costs are $522,000. The firm can increase its production by 5 percent, without increasing either its total fixed costs or its variable costs per unit. A customer has made a one-time offer for an additional 50,000 units at a price per unit of $0.10. Should the firm sell the additional units at the offered price? Why or why not?    A.  yes; The offered price is less than the marginal cost. B.  yes; The offered price is equal to the marginal cost. C.  yes; The offered price is greater than the marginal cost. D.  no; The offered price is less than the marginal cost. E.  no; The offered price is greater than the marginal cost. Variable cost per unit = ($522,000 - $320,000)/1,800,000 = $0.112 per unit The marginal cost per unit will be $0.112 since the variable cost per unit will be unchanged. The order should not be accepted since the marginal cost per unit exceeds the offered price.

76.

Wexford Industrial Supply is considering a new project with estimated depreciation of $26,000, fixed costs of $79,000, and total sales of $187,000. The variable costs per unit are estimated at $11.80. What is the accounting break-even level of production?    A.  4,871 units B.  5,333 units C.  5,415 units D.  6,949 units E.  7,248 units Qaccounting break-even = ($79,000 + $26,000)/[($187,000/Q) - $11.80] Q = 6,949 units