Required Contribution Margin = Fixed Cost + Profit
= $ 50,000 + $ 20,000
= $ 70,000
Dollar Sales required to attain the required profit = Required Contribution Margin / Contribution Margin Ratio
= $ 70,000 / 30%
= $ 233,333.33
Hence the correct answer is $ 233,333
A company sells a product with a contribution margin ratio of 30%. The company's monthly fixed...
A company sells a product with a contribution margin ratio of 20%. The company's monthly fixed expense is $400,000 and the company's monthly target profit is $100,000. The dollar sales required to attain the target profit are: A. $2,500,000 B. $1,500,000 C. $625,000 D. $2,000,000 Sales above the break-even point will result in net profit equal to _______. A. number of units above break-even times fixed cost per unit B. number of units above break-even times contribution margin per unit...
1. What is the company’s contribution margin (CM) ratio? 2. What is the estimated change in the company’s net operating income if it can increase total sales by $1,800? (Do not round intermediate calculations.) 1-a. The marketing manager argues that a $9,000 increase in the monthly advertising budget would increase monthly sales by $20,000. Calculate the increase or decrease in net operating income. 1-b. Should the advertising budget be increased? 2-a. Refer to the original data. Management is considering using...
Watson Company has monthly fixed costs of $80,000 and a 50% contribution margin ratio. If the company has set a target monthly income of $14,700, what dollar amount of sales must be made to produce the target income? $94,700 $160,000 $29,400 C) $130,600 $189,400 The budgeted income statement presented below is for Burkett Corporation for the coming fiscal year. Compute the number of units that must be sold in order to achieve a target pretax income of $179,000. $990,000 Sales...
7 Sales Variable expenses Contribution margin Fixed expenses Net operating income Total $ 310,000 217,000 93,000 75,000 $ 18,000 Per Unit $20 14 $ 6 25 oints eBook Required: 1. What is the monthly break-even point in unit sales and in dollar sales? 2. Without resorting to computations, what is the total contribution margin at the break-even point? 3-a. How many units would have to be sold each month to attain a target profit of $34,200? 3-b. Verify your answer...
Menlo Company distributes a single product. The company's sales and expenses for last month follow: Sales Variable expenses Contribution margin Fixed expenses Net operating income Total $ 300,000 210,000 90,000 72.000 $ 18,000 Per Unit $20 14 $ 6 Required: 1. What is the monthly break-even point in unit sales and in dollar sales? 2. Without resorting to computations, what is the total contribution margin at the break even point? 3-a. How many units would have to be sold each...
Brihon Corporation produces and sells a single product. Data concerning that product appear below: Selling price per unit Variable expense per unit Fixed expense per month $ 230.00 $ 103.50 $518,650 Required: a. Assume the company's monthly target profit is $12,650. Determine the unit sales to attain that target profit. b. Assume the company's monthly target profit is $63,250. Determine the dollar sales to attain that target profit.
Jilk Inc.'s contribution margin ratio is 60% and its fixed monthly expenses are $42,500. Assuming that the fixed monthly expenses do not change, what is the best estimate of the company's net operating income in a month when sales are $127,000? Escareno Corporation has provided its contribution format income statement for June. The company produces and sells a single product. Sales (8,400 units) Variable expenses Contribution margin Fixed expenses Net operating income $764,400 445,200 319,200 250,900 $ 68,300 If the...
10.Gayne Corporation's contribution margin ratio is 12% and its fixed monthly expenses are $84.000. If the company's sales for a month are $738,000, what is the best estimate of the company's net operating income? Assume that the fixed monthly expenses do not change. A) $88,560 B)$4,560 C) $565,440 D) $654,000 11.Product Y sells for $15 per unit, and has related variable expenses of $9 per unit. Fixed expenses total $300,000 per year. How many units of Product Y must be...
Lindon Company is the exclusive distributor for an automotive product that sells for $50.00 per unit and has a CM ratio of 30%. The company's fixed expenses are $345,000 per year. The company plans to sell 27,200 units this year. Required: 1. What are the variable expenses per unit? (Round your "per unit" answer to 2 decimal places.) 2. What is the break-even point in unit sales and in dollar sales? 3. What amount of unit sales and dollar sales...
Lindon Company is the exclusive distributor for an automotive product that sells for $52.00 per unit and has a CM ratio of 30%. The company's fixed expenses are $366,600 per year. The company plans to sell 27,900 units this year. Required: 1. What are the variable expenses per unit? (Round your "per unit" answer to 2 decimal places.) 2. What is the break-even point in unit sales and in dollar sales? 3. What amount of unit sales and dollar sales...