Question

Bookmatch 12-2 (book/static) for the Hugo Boss Corporation. It represents the most recent year's operations, which ended yesterday Your supervisor in the controller's office has (Break-even als) You have developed the income alement in the popup window, handed you a memorandumasing for one to the following and home What is the hodiny , by what What is the firm's break even in der $ 202107 ond to the restor C o und to two decimal ploom)

Answer 1

Computation of Break Even sales in dollar Sno Particulars 1 Saless 50439375 2 Variable cost 25137000 3 Contribution(1-2) 25302375 4 Fixed Costs 10143000 5 EBIT(3-4) 15159375 Break even sales= Fixed Cost P/V Ratio Break even sales= 10143000 50.16 % = 20219706 Dollars Note: P/V Ratio= Contribution *100 Sales P/V Ratio= 25302375 *100 50439375 P/V Ratio= 50.16 %

2.EBIT and Net Income when sales increase by 30% Sno Particulars Amount 1 Saless(Increase by 30%) 6,55,71,188 2 Variable cost 3,26,78,100 (50439375*25137000)/65571188) 3 Contribution(1-2) 3,26,78,100 4 Fixed Costs 1,01,43,000 5 EBIT(3-4) 2,25,35,100 6 Interest Expense 14,88,375 7 EBT 2,10,46,725 8 Taxes@50% 1,05,23,363 9 EAT(7-8) 1,05,23,363 % of Increase in EBIT= New EBIT-Old EBIT Old EBIT 2,25,35,100-1,51,59,375 1,51,59,375 48.65 % % of Increase in Net Income New Net Income-Old Net Income Old Net Income 1,05,23,363-68,35,500 68,35,500 53.95 %