A segment has the following data: Sales $790000 Variable expenses 345000 Fixed expenses 550000
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A segment has the following data:
| Sales | $790000 |
| Variable expenses | 345000 |
| Fixed expenses | 550000 |
What will be the incremental effect on net income if this segment is eliminated, assuming the fixed expenses will be allocated to profitable segments?
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- Given the following information:SalesFixed ExpensesVariable Expensess5,0002,0001,750What would expected operating profit be if the company experienced a 10% increase in fixedcosts and a 100/0 increase m sales volume? a) $1,375. b) $1,550. c) $1,250. d) $1,750.Assume that sales of the Standard racket increase by $21,800. What would be the effect on net operating income? What would be the effect if Pro racket sales increased by $21,800? Do not prepare income statements; use the incremental analysis approach in determining your answer.INCOME STATEMENT Hermann Industries is forecasting the following income statement:Sales $8,000,000Operating costs excluding depr. & amort. 4,400,000EBITDA $3,600,000Depreciation & amortization 800,000EBIT $2,800,000Interest 600,000EBT $2,200,000Taxes (40%) 880,000Net income $1,320,000The CEO would like to see higher sales and a forecasted net income of $2,500,000. Assumethat operating costs (excluding depreciation and amortization) are 55% of sales and thatdepreciation and amortization and interest expenses will increase by 10%. The tax rate, whichis 40%, will remain the same. What level of sales would generate $2,500,000 in net income?
- Understanding CVP relationships Calculate the missing amounts for each of thefollowing firms: Contribution Variable Margin Fixed OperatingSales Costs Ratio Costs Income (Loss)Firm A $320,000 ? 32% ? $38,300Firm B ? $465,050 ? $118,000 71,950Firm C 134,000 ? 26% 36,700 ?Firm D ? 59,000 20% ? (4,920)1. Compute the companywide break-even point in dollar sales. 2. Compute the break-even point in dollar sales for the East region. 3. Compute the break-even point in dollar sales for the West region. 4. Prepare a new segmented income statement based on the break-even dollar sales that you computed in requirements 2 and 3. Use the same format as shown above. What is Crossfire’s net operating income (loss) in your new segmented income statement? 5. Do you think that Crossfire should allocate its common fixed expenses to the East and West regions when computing the break-even points for each region?Solvency and Profitability Trend Analysis (Part A is the only one I got incorrect, let me know what the correct answers are) Addai Company has provided the following comparative information: 20Y8 20Y7 20Y6 20Y5 20Y4 Net income $273,406 $367,976 $631,176 $884,000 $800,000 Interest expense 616,047 572,003 528,165 495,000 440,000 Income tax expense 31,749 53,560 106,720 160,000 200,000 Total assets (ending balance) 4,417,178 4,124,350 3,732,443 3,338,500 2,750,000 Total stockholders’ equity (ending balance) 3,706,557 3,433,152 3,065,176 2,434,000 1,550,000 Average total assets 4,270,764 3,928,396 3,535,472 3,044,250 2,475,000 Average total stockholders' equity 3,569,855 3,249,164 2,749,588 1,992,000 1,150,000 You have been asked to evaluate the historical performance of the company over the last five years. Selected industry ratios have remained relatively steady at the…
- Using Goal Seek/Solver and/or What-If Scenarios based on the below income statement, calculate the following a) the sales amount in order to realize $1,200,000 of net income without changing any of the expense accounts. b) to realize $1,200,000 without changing revenues and cost of goods sold. c) What could be the best scenario to achieve NI $1,200,000.Assume the marketing department has presented a plan to increase advertising expenses by $340 million. It expects this plan to result in an increase in both net sales and cost of goods sold of 25%. (Hint: Increase both sales revenue and sales returns and allowances by 25%.) Redo parts (a) and (b) and discuss whether this plan has merit. (Assume a tax rate of 34%, and round all amounts to whole dollars.)Prepare a multiple-step income statement. (Round answers to 0 decimal places, e.g. 15,222.)Company XYZ is currently making sales of $200,000. At this level, the variable expenses viere $160,000 . Assume that company XYZ expects sales to increase to $450,003 in coming period with no change is expected to fixed expenses. How much is the expected change in profit ? a- Increase by $ 10,000 b -Increase by 40,000 C- increase by $ 50,000 D-be determined E- Increase by $160,000
- Solvency and Profitability Trend Analysis (Picture is attached and this is the only one I got wrong, what did I do wrong?) Addai Company has provided the following comparative information: 20Y8 20Y7 20Y6 20Y5 20Y4 Net income $273,406 $367,976 $631,176 $884,000 $800,000 Interest expense 616,047 572,003 528,165 495,000 440,000 Income tax expense 31,749 53,560 106,720 160,000 200,000 Total assets (ending balance) 4,417,178 4,124,350 3,732,443 3,338,500 2,750,000 Total stockholders’ equity (ending balance) 3,706,557 3,433,152 3,065,176 2,434,000 1,550,000 Average total assets 4,270,764 3,928,396 3,535,472 3,044,250 2,475,000 Average total stockholders' equity 3,569,855 3,249,164 2,749,588 1,992,000 1,150,000 You have been asked to evaluate the historical performance of the company over the last five years. Selected industry ratios have remained relatively steady at the following…Provide the missing data in the following tabulation: Division Alpha Bravo Charlie Revenue 11500000 Operating profit 920000 210000 Average operating assets 800000 Margin 4,00% 7,00% Turnover 5 Return on investment (ROI) 20% 14%Company XYZ is currently making sales of $200,000 . At this level , the variable expenses were $40,000 . Assume that company XYZ expects sales to increase $ 400,000 in the coming period with no change is expected to fixed expenses . How much is the expected change in profit ? a. Increase by $ 160,000 b. Cannot be determined c. Increase by $ 50,000 d. Increase by 40,000 e. Increase by $10,000