Question

I NEED THE ANSWERS FOR F, G1, G2 AND H1. THE OTHER ARE ALREADY ANSWERED. THANK YOU

Monterey Co. makes and sells a single product. The current selling price is $15 per unit. Variable expenses are $9 per unit, and fixed expenses total $31,900 per month. (Unless otherwise stated, consider each requirement separately.)

a. Calculate the break-even point expressed in terms of total sales dollars and sales volume. (Do not round intermediate calculations.)

break even sales = 79750

break even volume = 5317 units

b. Calculate the margin of safety and the margin of safety ratio. Assume current sales are $94,750. (Do not round intermediate calculations. Round your percentage answer to 2 decimal places.)

Margin of safety = 15000

Margin of safety of ratio = 15.83 %

c. Calculate the monthly operating income (or loss) at a sales volume of 5,150 units per month. (Do not round intermediate calculations.)

-1000

d. Calculate monthly operating income (or loss) if a $2 per unit reduction in selling price results in a volume increase to 8,300 units per month. (Do not round intermediate calculations.)

1300

f. Calculate the monthly operating income (or loss) that would result from a $1 per unit price increase and a $6,000 per month increase in advertising expenses, both relative to the original data. Assume a sales volume of 5,150 units per month. (Do not round intermediate calculations.)

Management is considering a change in the sales force compensation plan. Currently each of the firm's two salespeople is paid a salary of $2,500 per month.

g-1. Calculate the monthly operating income (or loss) that would result from changing the compensation plan to a salary of $400 per month, plus a commission of $0.75 per unit, assuming a sales volume of 5,150 units per month. (Do not round intermediate calculations.)

g-2. Calculate the monthly operating income (or loss) that would result from changing the compensation plan to a salary of $400 per month, plus a commission of $0.75 per unit, assuming a sales volume of 6,350 units per month. (Do not round intermediate calculations. Losses should be indicated by a minus sign.)

h-1. Assuming that the sales volume of 6,350 units per month achieved in part g could also be achieved by increasing advertising by $1,000 per month instead of changing the sales force compensation plan. What would be the operating income or loss? (Do not round intermediate calculations. Losses should be indicated by a minus sign.)

Answer 1

As I have answered C also. So you can understand My calculation for your reference

Part - C		Qty	Rate	Amount in $
Sales	A	5150	$ 15	77,250
Variable Cost	B	5150	$ 9	46,350
Contribution	B-A	5150	$ 6	30,900
Fixed Cost	D	31,900		31,900
Net Profit/Loss	C-D			-1,000

Part - F		Qty	Rate	Amount in $
Sales	A	5150	$ 16	82,400
Variable Cost	B	5150	$ 9	46,350
Contribution	B-A	5150	$ 7	36,050
Fixed Cost	D	31,900 + 6,000		37,900
Net Profit/Loss	C-D			-1,850

Part - G1		Qty	Rate	Amount in $
Sales	A	5150	$ 15	77,250
Variable Cost	B	5150	$ 9	46,350
Contribution	C = B-A	5150	$ 6	30,900
Fixed Cost	D	31,900 - (2500*2) +[(400*2) + ($0.75 * 5150)]		31,563
Net Profit/Loss	C-D			-663

Part - G2		Qty	Rate	Amount in $
Sales	A	6350	$ 15	95,250
Variable Cost	B	6350	$ 9	57,150
Contribution	C = B-A	6350	$ 6	38,100
Fixed Cost	D	31,900 - (2500*2) + [(400*2) + ($0.75 * 6350)]		32,463
Net Profit/Loss	C-D			5,638

Part - H1		Qty	Rate	Amount in $
Sales	A	6350	$ 15	95,250
Variable Cost	B	6350	$ 9	57,150
Contribution	C = B-A	6350	$ 6	38,100
Fixed Cost	D	31,900 + 1,000		32,900
Net Profit/Loss	C-D			5,200