In 2010, Runge Company Had a Break-Even Point of $800,000

question 69

Essay

In 2010, Runge Company had a break-even point of $800,000 based on a selling price of $10 per unit and fixed costs of $240,000. In 2011, the selling price and variable costs per unit did not change, but the break-even point increased to $900,000.
Instructions
(a) Compute the variable cost per unit and the contribution margin ratio for 2010.
(b) Using the contribution margin ratio, compute the increase in fixed costs for 2011.

Distinguish between taxable and non-taxable forms of income.

Recognize the implications of different filing statuses such as head of household, single, and married filing jointly.

Understand the progressive nature of the U.S. tax system and how it applies to taxpayers at different income levels.

Identify the role and contents of essential tax documents such as W-2, 1040, and 1099 forms.

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