The condensed income statement for a Fletcher Inc. for the past
year is as follows:
Product...
The condensed income statement for a Fletcher Inc. for the past
year is as follows:
Product
F
G
H
Total
Sales
$300,000
$210,000
$340,000
$850,000
Costs:
Variable costs
$180,000
$180,000
$220,000
$590,000
Fixed costs
50,000
50,000
40,000
140,000
Total costs
$230,000
$230,000
$260,000
$730,000
Income (loss)
$ 70,000
$(20,000)
$ 80,000
$120,000
Management is considering the discontinuance of the manufacture and
sale of Product G at the beginning of the current year. The
discontinuance would have no effect on the...
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:
Westerville Company reported the following results from last
year’s operations:
Sales
$
1,000,000
Variable expenses
300,000 ...
Westerville Company reported the following results from last
year’s operations:
Sales
$
1,000,000
Variable expenses
300,000
Contribution margin
700,000
Fixed expenses
500,000
Net operating income
$
200,000
Average operating assets
$
625,000
This year, the company has a $120,000 investment opportunity
with the following cost and revenue characteristics:
Sales
$
200,000
Contribution margin ratio
60
% of sales
Fixed expenses
$
90,000
The company’s minimum required rate of return is
15%.
5.
What is the turnover related to this year’s...
The Whippleton Department had gross profit on sales of $120,000,
contribution margin of $60,000, total direct...
The Whippleton Department had gross profit on sales of $120,000,
contribution margin of $60,000, total direct expenses of $18,000,
and total indirect expenses of $52,000. The Whippleton Department
has
a. a net income from operations of $42,000.
b. a net income from operations of $8,000.
c. a net income from operations of $50,000.
d. a net loss from operations of $10,000.
Total
Store A
Store B
Sales
$1,000,000
$400,000
$600,000
Variable expenses
580,000
160,000
420,000
Contribution margin...
Total
Store A
Store B
Sales
$1,000,000
$400,000
$600,000
Variable expenses
580,000
160,000
420,000
Contribution margin
420,000
240,000
180,000
Traceable fixed expenses
300,000
100,000
200,000
Store segment margin
120,000
140,000
-20,000
Common fixed expenses
50,000
20,000
30,000
Net operating income
$70,000
$120,000
($50,000)
Due to its poor showing, consideration is being given to closing
Store B. Studies show that if Store B is closed, one-fourth of its
traceable fixed expenses will continue unchanged. The studies also
show that closing Store...
Candel Gym has sales of $300,000 this month, contribution margin
of $90,000, monthly fixed cost of...
Candel Gym has sales of $300,000 this month, contribution margin
of $90,000, monthly fixed cost of $54,000 and profit of $36,000.
What is the firm’s current margin of safety ratio to sales [ie.,
safety margin ratio]?
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? *
part 1
Candle Co. has sales of $200,000 this month, contribution
margin of $100,000, monthly fixed...
part 1
Candle Co. has sales of $200,000 this month, contribution
margin of $100,000, monthly fixed cost of $80,000 and profit of
$20,000. What is the firm’s current breakeven volume in dollars?
(rounded)
Select one:
a. All listed choices are incorrect.
b. $160,000.
c. $180,000.
d. $140,000.
part 2
Candle Co. has sales of $200,000 this month, contribution
margin of $100,000, monthly fixed cost of $80,000 and profit of
$20,000. What is the firm’s current breakeven ratio to sales?
(rounded)...
Sales
$60,000
Less: Variable Expenses
45,000
Contribution Margin
15,000
Less: Fixed Expenses
18,000
Net Income
-$3,000...
Sales
$60,000
Less: Variable Expenses
45,000
Contribution Margin
15,000
Less: Fixed Expenses
18,000
Net Income
-$3,000
a. What are the total sales in dollars at the break-even
point?
b. What are the total variable expenses at the break-even
point?
c. What is the company's contribution margin ratio?
d. If unit sales were increased by 10% and fixed expenses were
reduced by $2,000, what would be the company's expected net income?
(Prepare a new income statement.)
Decision to Discontinue a Product
On the basis of the following data, the general manager of...
Decision to Discontinue a Product
On the basis of the following data, the general manager of
Foremost Footwear Inc. decided to discontinue Children’s Shoes
because it reduced income from operations by $10,000. What is the
flaw in this decision if it is assumed that fixed costs would not
be materially affected by the discontinuance?
Foremost Footwear Inc.
Product-Line Income Statement
For the Year Ended April 30, 20Y7
Children's Shoes
Men's Shoes
Women's Shoes
Total
Sales
$165,000
$300,000
$500,000
$965,000
Costs...