Required:
1. Complete the table.
2. Ramada sells its carts for $1,050 each. Prepare a contribution margin income statement for each of the three production levels given in the table.
4. Calculate Ramada’s break-even point in number of units and in sales revenue.
5. Assume Ramada sold 1,000 carts last year. Without performing any calculations, determine whether Ramada earned a profit last year.
6. Calculate the number of carts that Ramada must sell to earn $30,000 profit.
7. Calculate Ramada’s degree of operating leverage if it sells 2,050 carts.
8. Using the degree of operating leverage, calculate the change in Ramada’s profit if sales are 10 percent less than expected.
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Ramada Company produces one golf cart model. A partially complete table of company costs follows:
Ramada Company produces one golf cart model. A partially complete table of company costs follows: Required 1. Complete the table. (Round your Cost per Unit answers to 2 decimal places.) Number of Golf Carts Produced and Sold 600 Units 800 Units 1000 Units Total costs Variable costs $ 400,000 Fixed costs per year 250,000 Total costs 0$650,000 S Cost per unit Variable cost per unit Fixed cost per unit Total cost per unit 0.00 $ 0.00 S 0.00 2. Ramada...
Normal No Spacing Heading 1 Heading 2 Ramada Company produces one golf cart model. A partially complete table of company costs follows: 400 600 800 $ Number of golf carts produced and sold Total costs Variable costs Fixed costs per year Total costs Cost per unit Variable cost per unit Fixed cost per unit Total cost per unit $ 384,000 144,000 528,000 Required: 1. Complete the table. 2. Ramada sells its carts for $1,600 each. Prepare a contribution margin income...
King Peak Company produces one security door model. A partially complete table of its costs follows: Number of doors produced and sold 400 500 700 Total costs Variable costs $40,000 $? $? Fixed costs per year 65.000 ? Total costs 105,000 ? Cost per unit Variable cost per unit Fixed cost per unit Total cost per unit Required: 1. Complete the table. 2. King Peak sells its doors for $200 each. Prepare a contribution margin income statement for each of...
Required:1. Determine Cove’s break-even point in units and sales dollars.2. Determine the bakery’s margin of safety if it currently sells 430 cakes per month.3. Determine the number of cakes that Cove must sell to generate $1,500 in profit.Screen Shot 2021-04-02 at 10.25.14 PM.pngScreen Shot 2021-04-02 at 10.25.33 PM.pngScreen Shot 2021-04-02 at 10.25.24 PM.png
The Rosa model of Mohave Corp. is currently manufactured as a very plain umbrella with no decoration. The company is considering changing this product to a much more decorative model by adding a silk-screened design and embellishments. A summary of the expected costs and revenues for Mohave’s two options follows: Rosa UmbrellaDecorated UmbrellaEstimated demand27,000units27,000unitsEstimated sales price$29.00$39.00Estimated manufacturing cost per unitDirect materials$19.50$21.50Direct labor4.507.00Variable manufacturing overhead3.505.50Fixed manufacturing overhead6.006.00Unit manufacturing cost$33.50$40.00Additional development cost$12,000Required:1. Determine the increase or decrease in profit if Mohave sells the Rosa...
Mohave Corp. makes several varieties of beach umbrellas and accessories. It has been approached by a company called Lost Mine Industries about producing a special order for a custom umbrella called the Ultimate Shade (US). The special-order umbrellas with the Lost Mine Company logo would be distributed to participants at an upcoming convention sponsored by Lost Mine. Lost Mine has offered to buy 3,100 of the US umbrellas at a price of $32 each. Mohave currently has the excess capacity necessary...
Presidio, Inc., produces one model of mountain bike. Partial information for the company follows: Required: 1. Complete Presidio's cost data table. 2. Calculate Presidio's contribution margin ratio and its total contribution margin at each sales level indicated in the cost data table assuming the company sells each bike for $650. 3. Calculate net operating income at each of the sales levels assuming a sales price of $650. Complete this question by entering your answers in the tabs below. Required 1...
Northwood Company manufactures basketballs. The company has a ball that sells for $25. At present, the ball is manufactured in a small plant that relies heavily on direct labor workers. Thus, variable expenses are high, totaling $15.00 per ball, of which 60% is direct labor cost. Last year, the company sold 44,000 of these balls, with the following results: Sales (44,000 balls) $ 1,100,000 Variable expenses 660,000 Contribution margin 440,000 Fixed expenses 317,000 Net operating income $ 123,000 Required: Compute...
Check my work Northwood Company manufactures basketballs. The company has a ball that sells for $25. At present, the ball is manufactured in a small plant that relies heavily on direct labor workers. Thus, variable expenses are high, totaling $15.00 per ball, of which 60% is direct labor cost. Last year, the company sold 60,000 of these balls, with the following results: Sales (60,000 balls) Variable expenses Contribution margin Fixed expenses Net operating income $1,500,000 900,000 600,000 375,000 $ 225,000...
Last year, the company sold 32,000 of these balls, with the following results: $ Sales (32,000 balls) Variable expenses Contribution margin Fixed expenses Net operating income 800,000 480,000 320,000 211,000 109,000 $ Required: 1. Compute (a) last year's CM ratio and the break-even point in balls, and (b) the degree of operating leverage at last year's sales level. 2. Due to an increase in labor rates, the company estimates that next year's variable expenses will increase by $3.00 per ball....