The following information pertains to Fun in the Sun, Inc., a beach ball manufacturer: Budgeted production costs for the coming year:
Direct materials per ball
Direct labor
ball
Variable overhead per ball
Total fixed overhead
per
$ 5
3
7
47,140
MN
Budgeted selling and administrative costs for the coming year:
Fixed selling & admin expense
$ 23,350
Shipping cost per ball
2
In the coming year, Fun in the Sun plans to produce and
sell 7,100 beach balls at a price of $31 each.
Instructions for Project 3:
1. Prepare a CVP income statement.
2. Calculate the breakeven point in units and sales dollars.
3. Calculate the margin of safety.
4. Calculate the margin of safety ratio.
5. If Fun in the Sun wants to earn net income of $50,000, how many units must
it sell?

At a student café, there are equal numbers of two types of customers with the following values. the café owner cannot distinguish between the two types of students because many students without early classes arrive early anyway (i.e., she cannot price-discriminate). students with early classes students without early classes coffee 70 60 banana 51 101 the marginal cost of coffee is 10 and the marginal cost of a banana is 40. the café owner is considering three pricing strategies: 1. mixed bundling: price bundle of coffee and a banana for 161, or just a coffee for 70. 2. price separately: offer coffee at 60, price a banana at 101. 3. bundle only: coffee and a banana for 121. do not offer goods separately. assume that if the price of an item or bundle is no more than exactly equal to a student's willingness to pay, then the student will purchase the item or bundle. for simplicity, assume there is just one student with an early class, and one student without an early class. price strategy revenue from pricing strategy cost from pricing strategy profit from pricing strategy 1. mixed bundling $ $ $ 2. price separately $ $ $ 3. bundle only $ $ $ pricing strategy yields the highest profit for the café owner.

Brian has been working for a few years now and has saved a substantial amount of money. he now wants to invest 50 percent of his savings in a bank account where it will be locked for three years and gain interest. which type of bank account should brian open? a. savings account b. money market account c. checking account d. certificate of deposit

Stella company sells only two products, product a and product b. product a product b total selling price $50 $30 variable cost per unit $20 $10 total fixed costs $2,110,000 stella sells two units of product a for each unit it sells of product b. stella faces a tax rate of 40%. stella desires a net afterminustax income of $54,000. the breakeven point in units would be