Question

Dog Emporium reported the following information for the sales of their single product: Total Per Unit...

Dog Emporium reported the following information for the sales of their single product:

Total Per Unit
Sales $ 300,000 $ 10
Variable expenses 180,000 6
Contribution margin 120,000 $ 4
Fixed expenses 100,000
Net operating income $ 20,000

Dog's salesmen have proposed to decrease the selling price by 50 cents per unit. How many units will need to be sold for Dog to earn at least the same net operating income?

Multiple Choice

  • 5,715 units

  • 36,000 units

  • 34,286 units

  • 28,572 units

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1
Correct Option C i.e. 34386 Units
Working Note :
After decreasing selling price by 50 cents contribution margin also fall by 50 cents
Target units =( Total fixed cost + Target Income )/Contribution margin per unit
    =(100000 + 20000) / 3.5
                                                                  34,286 Units
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
Assume the following information: Amount Per Unit Sales $ 300,000 $ 40 Variable expenses 120,000 16...
Assume the following information: Amount Per Unit Sales $ 300,000 $ 40 Variable expenses 120,000 16 Contribution margin 180,000 $ 24 Fixed expenses 60,000 Net operating income $ 120,000 The margin of safety percentage is closest to:
7. Assume the following information:    Amount Per Unit Sales $ 300,000 $ 40 Variable expenses...
7. Assume the following information:    Amount Per Unit Sales $ 300,000 $ 40 Variable expenses 112,500 15 Contribution margin 187,500 $ 25 Fixed expenses 38,000 Net operating income $ 149,500    The dollar sales to break-even is: Multiple Choice $149,500. $101,333. $47,500. $60,800. 12. Assume the sales budget for April and May is 46,000 units and 48,000 units, respectively. The production budget for the same two months is 43,000 units and 44,000 units, respectively. Each unit of finished goods...
A company’s contribution format income statement for the most recent month is shown below: Total Per...
A company’s contribution format income statement for the most recent month is shown below: Total Per Unit Sales (44,000 units) $ 352,000 $ 8.00 Variable expenses 220,000 5.00 Contribution margin 132,000 $ 3.00 Fixed expenses 49,000 Net operating income $ 83,000 What is the revised net operating income if the selling price per unit increases by 20%, variable expenses increase by 20 cents per unit, and the number of units sold decreases by 10%? Multiple Choice $135,815 $122,713 $125,240 $132,462
Moyas Corporation sells a single product for $20 per unit. Last year, the company's sales revenue...
Moyas Corporation sells a single product for $20 per unit. Last year, the company's sales revenue was $285,000 and its net operating income was $45,500. If fixed expenses totaled $97,000 for the year, the break-even point in unit sales was: Multiple Choice Top of Form 14,250 units 7,125 units 16,525 units 9,700 units Bottom of Form
Exercise 6-13 Changes in Selling Price, Sales Volume, Variable Cost per Unit, and Total Fixed Costs...
Exercise 6-13 Changes in Selling Price, Sales Volume, Variable Cost per Unit, and Total Fixed Costs [LO6-1, LO6-4] Miller Company’s contribution format income statement for the most recent month is shown below: Total Per Unit Sales (42,000 units) $ 294,000 $ 7.00 Variable expenses 168,000 4.00 Contribution margin 126,000 $ 3.00 Fixed expenses 46,000 Net operating income $ 80,000 Required: (Consider each case independently): 1. What is the revised net operating income if unit sales increase by 14%? 2. What...
Exercise 5-13 Changes in Selling Price, Sales Volume, Variable Cost per Unit, and Total Fixed Costs...
Exercise 5-13 Changes in Selling Price, Sales Volume, Variable Cost per Unit, and Total Fixed Costs [LO5-1, LO5-4] Miller Company’s contribution format income statement for the most recent month is shown below: Total Per Unit Sales (31,000 units) $ 248,000 $ 8.00 Variable expenses 155,000 5.00 Contribution margin 93,000 $ 3.00 Fixed expenses 42,000 Net operating income $ 51,000 Required: (Consider each case independently): 1. What is the revised net operating income if unit sales increase by 10%? 2. What...
Exercise 5-13 Changes in Selling Price, Sales Volume, Variable Cost per Unit, and Total Fixed Costs...
Exercise 5-13 Changes in Selling Price, Sales Volume, Variable Cost per Unit, and Total Fixed Costs [LO5-1, LO5-4] Miller Company’s contribution format income statement for the most recent month is shown below: Total Per Unit Sales (31,000 units) $ 248,000 $ 8.00 Variable expenses 155,000 5.00 Contribution margin 93,000 $ 3.00 Fixed expenses 42,000 Net operating income $ 51,000 Required: (Consider each case independently): 1. What is the revised net operating income if unit sales increase by 10%? 2. What...
Wawasee Lumber Company had the following data for July. Units Total Per Unit Sales 14500 826500...
Wawasee Lumber Company had the following data for July. Units Total Per Unit Sales 14500 826500 57 Variable Expenses 493000 34 Contribution Margin 333500 23 Fixed Expenses 165000 Net Operating Income 168500 1.   What would be the Net Operating Income if sales volume increased to 16,000 units? 2.   What would be the Net Operating Income if sales volume decreased to 13,000 units? 3. What would the Contribution Margin per unit be if the sales price is reduced by $4.00? 4....
A company makes a product that sells for $80 per unit. Variable expenses are $40.00 per...
A company makes a product that sells for $80 per unit. Variable expenses are $40.00 per unit, and fixed expenses total $180,000 per year. Its operating results for last year were as follows: Sales $ 2,240,000 Variable expenses 1,120,000 Contribution margin 1,120,000 Fixed expenses 180,000 Net operating income $ 940,000 The company president wants to add new features to the product, which will increase the variable expenses by $1.80 per unit. She thinks that the new features, combined with some...
Nice Corporation produces and sells a single product. Data concerning that product appear below: Per Unit...
Nice Corporation produces and sells a single product. Data concerning that product appear below: Per Unit Percent of Sales Selling price $ 260 100 % Variable expenses 65 25 % Contribution margin $ 195 75 % Fixed expenses are $180,000 per month. The company is currently selling 1,300 units per month. Required: Management is considering using a new component that would increase the unit variable cost by $54. Since the new component would improve the company's product, the marketing manager...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT