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The following information relates to FCG Company: Degree of operating leverage Margin of safety Margin of...
The following information relates to FCG Company: Degree of operating leverage 4 Margin of safety $25,000...
The following information relates to FCG Company: Degree of operating leverage 4 Margin of safety $25,000 Margin of safety percentage 25% Contribution margin ratio 40% 1. If FCG's sales increase by 10%, by what percentage will its net operating income increase? 2. FCG wants to give its only salesman a $3,000 salary increase. If FCG gives this increase, by how much would sales at FCG have to increase in order for the company to maintain its current net operating income...
Contribution margin ratio Gross margin ratio Margin of safety percentage Degree of operating leverage 40% 60%...
Contribution margin ratio Gross margin ratio Margin of safety percentage Degree of operating leverage 40% 60% 10% If O'Riley's sales increase by 25%, by what percentage will its net operating income increase? a. 40% b. 160%. c. 240%. d. 100%.
"E7-34A Compute margin of safety and operating leverage (Learning Objective 5) Terry’s Towing Service has a...
"E7-34A Compute margin of safety and operating leverage (Learning Objective 5) Terry’s Towing Service has a monthly target operating income of $30,000. Variable expenses are 40% of sales, and monthly fixed expenses are $7,500. Requirements Compute the monthly margin of safety in dollars if the shop achieves its income goal. Express Terry’s margin of safety as a percentage of target sales. What is Terry’s operating leverage factor at the target level of operating income? Assume that the company reaches its...
11-15 please. 12. what is the degree of operating leverage? 13. using the degree of operating...
11-15 please.
12. what is the degree of operating leverage?
13. using the degree of operating leverage, what is the
estimated percent increase in net operating income of a 5% increase
in sales?
14.assume that the amounts of the company's total variable
expenses and total fixed expenses were reversed. in other wrds,
assume that the total variable expenses are $27,720 and the total
fixed expenses are $73,500. under this scenario and assuming that
total sales remain the same, what is...
Contribution Margin, Break-Even Units, Break-Even Sales, Margin of Safety, Degree of Operating Leverage Aldovar Company produces...
Contribution Margin, Break-Even Units, Break-Even Sales, Margin of Safety, Degree of Operating Leverage Aldovar Company produces a variety of chemicals. One division makes reagents for laboratories. The division's projected income statement for the coming year is: Sales (203,000 units @ $70) $14,210,000 Total variable cost 8,120,000 Contribution margin $6,090,000 Total fixed cost 4,945,500 Operating income $1,144,500 Required: 1. Compute the contribution margin per unit, and calculate the break-even point in units. Calculate the contribution margin ratio and use it to...
Contribution Margin, Break-Even Units, Break-Even Sales, Margin of Safety, Degree of Operating Leverage Aldovar Company produces...
Contribution Margin, Break-Even Units, Break-Even Sales, Margin of Safety, Degree of Operating Leverage Aldovar Company produces a variety of chemicals. One division makes reagents for laboratories. The division's projected income statement for the coming year is: Sales (203,000 units @ $70) $14,210,000 Total variable cost 8,120,000 Contribution margin $6,090,000 Total fixed cost 4,945,500 Operating income $1,144,500 Required: 1. Compute the contribution margin per unit, and calculate the break-even point in units. Calculate the contribution margin ratio and use it to...
a) Degree of operating leverage = Contribution margin / profit Degree of operating leverage = 15,600,000...
a) Degree of operating leverage = Contribution margin / profit Degree of operating leverage = 15,600,000 / 6,000,000 = 1.625 Sales = 1200000 x 24 = 28800000 Less: Variable cost = 1200000 x 11 = 13200000 Contribution Margin = 28800000 - 13200000 = 15,600,000 Less: Fixed cost = 9,600,000 Profit = 15600000-9600000 = 6000000 b) Break even units Contribution margin per unit = Selling price - variable cost = $24 - $11 = $13 Break even units = Fixed cost...
Required: 1. What is the company's degree of operating leverage? 2. Using the degree of operating...
Required: 1. What is the company's degree of operating leverage? 2. Using the degree of operating leverage, estimate the impact on net operating income of a 28% increase in sales. 3. Construct a new contribution format income statement for the company assuming a 28% increase in sales. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Construct a new contribution format income statement for the company assuming a 28% increase in sales....
1. What is the company’s degree of operating leverage? 2. Using the degree of operating leverage,...
1. What is the company’s degree of operating leverage?
2. Using the degree of operating leverage, estimate the impact
on net operating income of a 18% increase in sales.
3. Construct a new contribution format income statement for
the company assuming a 18% increase in sales.
Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows: Sales Variable expenses Contribution margin Fixed expenses Net operating income Amount $ 143.000 57,200 85,800 21,000...
Problem 11-29 Margin of safety and operating leverage LO 11-6 Vernon Company is considering the addition...
Problem 11-29 Margin of safety and operating leverage LO 11-6 Vernon Company is considering the addition of a new product to its cosmetics line. The company has three distinctly different options: a skin cream, a bath oil, or a hair coloring gel. Relevant information and budgeted annual income statements for each of the products follow Skin Crean 136,000 Relevant Information B ath 011 216,000 Color Gel 96.000 Budgeted sales in units (a) Expected sales price (b) Variable costs per unit...
Contribution margin ratio Gross margin ratio Margin of safety percentage Degree of operating leverage 40% 60% 10% If O'Riley's sales increase by 25%, by what percentage will its net operating income increase? a. 40% b. 160%. c. 240%. d. 100%.
11-15 please.
12. what is the degree of operating leverage?
13. using the degree of operating leverage, what is the
estimated percent increase in net operating income of a 5% increase
in sales?
14.assume that the amounts of the company's total variable
expenses and total fixed expenses were reversed. in other wrds,
assume that the total variable expenses are $27,720 and the total
fixed expenses are $73,500. under this scenario and assuming that
total sales remain the same, what is...
Required: 1. What is the company's degree of operating leverage? 2. Using the degree of operating leverage, estimate the impact on net operating income of a 28% increase in sales. 3. Construct a new contribution format income statement for the company assuming a 28% increase in sales. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Construct a new contribution format income statement for the company assuming a 28% increase in sales....
1. What is the company’s degree of operating leverage?
2. Using the degree of operating leverage, estimate the impact
on net operating income of a 18% increase in sales.
3. Construct a new contribution format income statement for
the company assuming a 18% increase in sales.
Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows: Sales Variable expenses Contribution margin Fixed expenses Net operating income Amount $ 143.000 57,200 85,800 21,000...
Problem 11-29 Margin of safety and operating leverage LO 11-6 Vernon Company is considering the addition of a new product to its cosmetics line. The company has three distinctly different options: a skin cream, a bath oil, or a hair coloring gel. Relevant information and budgeted annual income statements for each of the products follow Skin Crean 136,000 Relevant Information B ath 011 216,000 Color Gel 96.000 Budgeted sales in units (a) Expected sales price (b) Variable costs per unit...
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