Question

Oman industries, Inc. reporated sales of $1, 000,000 for the month and incurred variable expenses totaling...

Oman industries, Inc. reporated sales of $1, 000,000 for the month and incurred variable expenses totaling $650,000 and fixed expenses totaling $100,000. 8,000 units were produced and sold during the month.

How many units would the company have to sell to achieve a desired profit 0f $500,000?

What is the compay's break even in total sales dollars?

What is the company's margin fo safety in dollars?

What is the company's degree of operating leverage?

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

How many units would the company have to sell to achieve a desired profit 0f $500,000?

Per Unit
Sales 1000000 125
Variable expenses 650000 81.25
Contrbution 350000 43.75

=(Fixed Cost +Desired Profit)/Contrbution Per Unit =(100000+500000)/43.75

=13714 Units

What is the compay's break even in total sales dollars?

Break Even Sales on Dollar

COntrbution Margin =43.75/125 =35%

=Fixed Cost /COntrbution Margin

100000/.35

=$285714.29

What is the company's margin fo safety in dollars?

Margin of Saftey=Sales- Break Even Sales

=1000000-$285714.29

=714285.71

What is the company's degree of operating leverage?

Contrbution/Net Income

=350000/(350000-100000)

=1.4

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
(URGENT) Zainab Inc. reported sales of Rs.8,000,000 for the month and incurred variable expenses totaling Rs.5,700,000...
(URGENT) Zainab Inc. reported sales of Rs.8,000,000 for the month and incurred variable expenses totaling Rs.5,700,000 and fixed expenses totaling Rs.1,440,000. The company has no beginning or ending inventories. A total of 80,000 units were produced and sold last month. What is the company's degree of operating leverage? [round your answer to 2 decimal places]                                                 What would be percentage change in net income if the sales increased by 10%?    
A company sells 25,000 units for $60 each. Variable expenses per unit are $35. Fixed expenses...
A company sells 25,000 units for $60 each. Variable expenses per unit are $35. Fixed expenses for the company are $220,000. Provide the following information. Enter your answers in the same order in which these appear. Contribution margin per unit Contribution margin ratio Break-even in unit sales Break-even in dollar sales Margin of safety in dollars Margin of safety percentage Degree of operating leverage
MENTO COMPANY distributes a single product. The company's sales and expenses for last month follow: The...
MENTO COMPANY distributes a single product. The company's sales and expenses for last month follow: The company sales 15,000 units last month. Sales ....................... (15,000 units) ....................$ $450,000    Variable expenses .............................................    180,000 Contribution margin ............................................. $ 270,000 Fixed expenses ................................................... 216,000 Net operating income ........................................... . $ 54,000 REQUIRED 1. What is the monthly BREAK EVEN POINT in units and dollar sales? 2. What is the Contribution Margin at the Break Even Point ? 3. How many units...
The following is TJLS Corporation's contribution format income statement for last month: Sales $1,200,000 Less: Variable...
The following is TJLS Corporation's contribution format income statement for last month: Sales $1,200,000 Less: Variable Expenses: $800,000 Contribution Margin: $400,000 Less: Fixed Expenses: $300,000 Operating Income: $100,000 5. What is the company's margin of safety in dollars? 6. What is the company's degree of operating leverage? Explain how a company could use this number in terms a non-accountant could understand. 7. If the tax rate is 30%, how many units must be sold to attain an after-tax profit of...
Menlo Company distributes a single product. The company’s sales and expenses for last month follow: Total...
Menlo Company distributes a single product. The company’s sales and expenses for last month follow: Total Per Unit Sales $ 316,000 $ 20 Variable expenses 221,200 14 Contribution margin 94,800 $ 6 Fixed expenses 78,000 Net operating income $ 16,800 Required: 1. What is the monthly break-even point in unit sales and in dollar sales?            Break Even Point in unit sales            Break Even Point in dollar sales 2. Without resorting to computations, what is the total contribution margin at...
In the month of September, Matlock Industries sold 800 units of product. The average sales price...
In the month of September, Matlock Industries sold 800 units of product. The average sales price was $30. During the month, fixed costs were $6,300 and variable costs were 70% of sales. Determine the contribution margin in dollars, per unit, and as a ratio. Contribution margin (in dollars) $ Unit contribution margin $ Contribution margin ratio %       Using the contribution margin technique, compute the break-even point in dollars and in units. Break-even sales (in dollars) $ Break-even sales...
Sales (10,000 units) S1,500,000 Less: variable expenses 900,000 Contribution margin 600,000 Less: fixed expenses 400,000 Operating...
Sales (10,000 units) S1,500,000 Less: variable expenses 900,000 Contribution margin 600,000 Less: fixed expenses 400,000 Operating income $200,000 1-What is the company's contribution margin ratio? * 2-What is the company's break-even in dollar? * 3-If sales increase by 100 units, by how much should operating income increase? * 4-How many units would the company have to sell to attain target operating income of $230,000? * 5-What is the company's margin of safety in dollars? *
Oslo Company prepared the following contribution format income statement based on a sales volume of 1,000...
Oslo Company prepared the following contribution format income statement based on a sales volume of 1,000 units (the relevant range of production is 500 units to 1,500 units): Sales $ 70,000 Variable expenses 38,500 Contribution margin 31,500 Fixed expenses 23,310 Net operating income $ 8,190 What is the break-even point in dollar sales? . How many units must be sold to achieve a target profit of $18,900? What is the margin of safety in dollars? What is the margin of...
Oslo Company prepared the following contribution format income statement based on a sales volume of 1,000...
Oslo Company prepared the following contribution format income statement based on a sales volume of 1,000 units (the relevant range of production is 500 units to 1,500 units): Sales $ 75,000 Variable expenses 45,000 Contribution margin 30,000 Fixed expenses 22,800 Net operating income $ 7,200 9.What is the break-even point in dollar sales? 10. How many units must be sold to achieve a target profit of $18,000? 11. What is the margin of safety in dollars? What is the margin...
Oslo Company prepared the following contribution format income statement based on a sales volume of 1,000...
Oslo Company prepared the following contribution format income statement based on a sales volume of 1,000 units (the relevant range of production is 500 units to 1,500 units): Required (Answer each question independently and always refer to the original data unless instructed otherwise.) Sales $ 22,100 Variable expenses 12,700 Contribution margin 9,400 Fixed expenses 7,708 Net operating income $ 1,692 7.If the variable cost per unit increases by $.80, spending on advertising increases by $1,300, and unit sales increase by...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT