Download: A CVP graph Solution

Download:	http://solutionzip.com/downloads/a-cvp-graph-solution/
Managerial Accounting – 14th Edition Garrison Noreen Brewer*P5-27
A CVP graph, as illistrated on the next page, is a useful technique for showing relationships among an organizations costs, volumns, and profits.
Required:
1. Identify the numbered components in the CVP graph.
2. State the effect of each of the following actions on line 3, line 9, and the break-even point. For line 3 and line 9, state whether the actions will cause the line to:
Remain unchanged
Shift upward
Shift downward
Have a steeper slope
Have a flatter slope
Shift upward and have a steeper slope
Shift upward and have a flatter slope
Shift downward and have a steeper slope
Shift downward and have a flatter slope
In the case of the break-even point, state whether the action will cause the break-even point to:
Remain unchanged
Increase
Decrease
Probably change, but the direction is uncertain
Treat each case independently.
a. The unit selling price is decreased from $30 to $27
b. THe per unit variable costs are increased from $12 to $15
c. The total fixed costs are reduced by $40,000
d. Five thousand fewer units are sold during the period than were budgeted.
e. Due to purchaing a robot to perform a task that was previously done by workers, fixed costs are increased by $25,000 per perios, and variable costs are reduced by $8 per unit
f. As a result of a decrease in the cost of materials, both unit variable costs and the sellign price are decreased by $3.
g. Advertising costs are increased by $50,000 per period, resulting in a 10% increase in the number of units sold.
h. Due to paying salespersons a commission rather than a flat salary, fixed costs are reduced by $21,000 per period, and unit variable costs are increased by $6.

Download:	http://solutionzip.com/downloads/a-cvp-graph-solution/