Hugo,owner of Automated Fabric,Inc

question 36

Multiple Choice

Hugo,owner of Automated Fabric,Inc. ,is interested in using the reciprocal allocation method.The following data from operations were collected for analysis:
Budgeted manufacturing overhead costs:

Services furnished:
By Maintenance (budgeted labor-hours) :

By Personnel (Number of employees serviced) :

Which of the following linear equations represents the complete reciprocated cost of the Personnel Department?

• A)P = $400,000 - $150,000 (1000 / 13,100)M
• B)P = (1000 / 13,100)M
• C)P = $150,000 + (1000 / 13,100)M
• D)P = $150,000

Interpret the impact of sales, variable costs, and fixed costs on profit through CVP analysis.

Calculate the effect of a change in costs (fixed and variable) on the break-even point.

Analyze and prepare a CVP income statement, distinguishing it from traditional income statements.

Use CVP analysis to make financial decisions within a nonprofit context.