Requirement 1. | Xavier's current operating income | ||||||
sales revenue | - | Fixed expenses | - | variable Expenses | = | Operating income | |
6000000 | - | 600000 | - | 1500000 | = | 3900000 | |
Requirement 2. | Xavier's contribution margin ratio | ||||||
Contribution margin | ÷ | sales | = | ||||
4500000 | ÷ | 6000000 | = | 0.75 | |||
The contribution margin ratio is | = | 75 | % | ||||
sales | - | variable cost | = | Contribution margin | |||
6000000 | - | 1500000 | = | 4500000 | |||
Requirement 3. | Companies breakeven point in sales doller | ||||||
(Fixed expenses | + | Operating income) | ÷ | Contribution margin | = | Breakeven poin in sales | |
(600000 | + | 0) | ÷ | 0.75 | = | 800000 |
Requirement 4. | If xavier embarks on this advertising campaign, sales revenue and variable cost will | increased | by | 16% | which | ||||||
will couse the cintribution margin to | 5220000 | by | 16% | however fixed cost will | increased | by | $ 200,000 | due to | |||
advertising. |
9. Xavier Medical Supply is a retailer of home medical equipment. Last year, Xavier's sales revenues...
Xavier Medical Supply is a retailer of home medical equipment. Last year, Xavier's sales revenues totaled $6,800,000. Total expenses were $2,600,000. Of this amount, approximately $1,088,000 were variable, while the remainder were fixed. Since Xavier's offers thousands of different products, its managers prefer to calculate the breakeven point in terms of sales dollars rather than units. Read the requirements. Contribution margin Sales revenue - Contribution margin ratio (Enter the ratio as a whole percent.) The contribution margin ratio is 84...
Medical Supply is a retailer of home medical equipment. Last year, Xavier's sales revenues totaled $ 6 comma 200 comma 000. Total expenses were $ 2 comma 500 comma 000. Of this amount, approximately $ 1 comma 612 comma 000 were variable, while the remainder were fixed. Since Xavier's offers thousands of different products, its managers prefer to calculate the breakeven point in terms of sales dollars rather than units. Xavier Medical Supply is a retailer of home medical equipment....
Requirement 4. Xavier's top management is deciding whether to embark on a $ 200 comma 000 advertising campaign. The marketing firm has projected annual sales volume to increase by 18% as a result of this campaign. Assuming that the projections are correct, what effect would this advertising campaign have on the company's annual operating income? If Xavier embarks on this advertising campaign, sales revenue and variable costs will rise by 18 %, which will cause the contribution margin to increase...
High Tech Manufacturing manufactures 256GB SD cards (memory cards for mobile phones, digital cameras, and other devices). Price and cost data for a relevant range extending to 200,000 units per month are as follows: High Tech Manufacturing manufactures 256GB SD cards (memory cards for mobile phones, digital cameras, and other devices). Price and cost data for a relevant range extending to 200,000 units per month are as follows: (Click the icon to view the data.) Read the requirements. Requirement 1....
GigaCo Manufacturing manufactures 256GB SD cards (memory cards for mobile phones, digital cameras, and other devices). Price and cost data for a relevant range extending to 200,000 units per month are as follows: BB (Click the icon to view the data.) Read the requirements. Requirement 1. What is the company's contribution margin per unit? Contribution margin percentage? Total contribution margin? Begin by identifying the formula. Sales price per unit Variable cost per unit = Contribution margin per unit The contribution...
6. Kerrigan Garage Doors manufactures a premium garage door. Currently, the price and cost data associated with the premium garage door are as follows: (Click the icon to view the data.) 2 (Click the icon to view more information.) Read the requirements Requirement 1. What is the company's current breakeven in units and in dollars? Begin by identifying the formula to compute the breakeven sales in units using the contribution margin approach. 1 Fixed expenses Operating income / Contribution margin...
Countrywide Travel uses the contribution margin income statement internally. Countrywide's first quarter results are as follows: (Click the icon to view the income statement.) Countrywide's relevant range is sales of between $140,000 and $690,000 Read the requirements Prepare contribution margin income statements at sales levels of $170,000 and $400,000. (Hint: Use the contribution margin ratio.) 2. Compute breakeven sales in dollars. Countrywide Travel Contribution Margin Income Statement Three Month. Er Jed March 31 Sales revenue 425,000 Less: Variable expenses 85,000...
Big Foot produces sports socks. The company has fixed expenses of $110,000 and variable expenses of $1.10 per package. Each package sells for $2.20. Read the requirements compute contribution Begin by identifying the formula to compute the contribution margin per package. The package. (Enter the amount to the nearest cent.) Sales price per unit Variable cost per unit Contribution margin The contribution margin per package is $ 1.10 Compute the contribution margin ratio. (Enter the ratio as a whole percent.)...
11. The budgets of four companies yield the following information: (Click the icon to view the budget information for the four companies.) Requirements 1. Fill in the blanks for each company 2. Compute breakeven, in sales dollars, for each company. Which company has the lowest breakeven point in sales dollars? What causes the low breakeven point? son Requirement 1. Fill in the blanks for each company (Round the contribution margin per unit and ratio calculations to two decimal places.) Q...
The budgets of four companies yield the following information: BE(Click the icon to view the budget information for the four companies.) Requirements 1. Fill in the blanks for each company. 2. Compute breakeven, in sales dollars, for each company. Which company has the lowest breakeven point in sales dollars? What cause x i Data Table Requirement 1. Fill in the blanks for each company. (Round the contribution margin per unit and ratio calculations to two decimal places.) Company Q 720,000...