Company has a monthly target operating income of $20,000. Variable expenses are 60% of sales and monthly fixed expenses are $11,400. What is John’s operating leverage factor at the target level of operating income?     1.35       1.43       1.75       1.57       2.00

Q: porated's contribution margin ratio is 61% and its fixed monthly expenses are $45,500. Assuming that…

A: Net operating income refers to the concept of evaluating the expected sum of money arising out of an…

Q: Gayne Corporation's contribution margin ratio is 12% and its fixed monthly expenses are $84,000. If…

A: Net operating Income= (Sales- Variable cost)-Fixed expenses = Contribution- Fixed expenses…

Q: Glacier Corporation produces and sells a single product. Data concerning that product appear below:…

A: Net operating income at current situation = Total contribution - Total fixed cost = (5300 units…

Q: Westerville Company reported the following results from last year’s operations: Sales $ 1,500,000…

A: Residual income refers to the income that is left after making all the necessary payments of the…

Q: Westerville Company reported the following results from last year’s operations:   Sales $…

A: = Residual income =Operating income– { Avg. operating assets x required rate of return (ROI)}…

Q: Your corporation sells a product for $10 per unit. The variable expenses are $6 per unit, and the…

A: Break-even analysis is a technique used widely by the production management. It helps to determine…

Q: Data for Hermann Corporation are shown below: Percent of Per Unit Sales Selling price Variable…

A: Here in this question, we are require to calculate the impact on net operating income if…

Q: Taylor Company has current sales of 1,000 units, which generates sales revenue of $190,000, variable…

A: Selling price = $190,000 / 1,000 = $190 Unit Variable cost = $76,000 / 1,000 = $76

Q: The following information relates to Zinc Corporation for last year: Sales Revenue ($500,000), Net…

A: Degree of operating leverage means the division of contribution with operating income. Variable cost…

Q: Neeley Grocery has a monthly target operating income of $25,000. Variabe expenses are 20% of sales…

A: Compute the Neeley Grocery's operating leverage factor at the target level of operating income:…

Q: Data for Hermann Corporation are shown below:                                              Per Unit…

A: Number of units proposed to sell = ((2,000 x $90)+ $9,000)/ $90 = 2,100 units

Q: Silver Incorporated reported the following results from last year’s operations:   Sales $…

A: Return on investment (ROI) :— It is the ratio between net operating income and average operating…

Q: Zekrom Corporation recorded the following information last year:  Sales of ₱450,000;  Net operating…

A: The degree of operating leverage (DOL) is calculated as ratio of contribution and operating income

Q: Westerville Company reported the following results from last year’s operations:   Sales $…

A: Lets understand the basics. Return on investment is a net operating income generated by using its…

Q: Your Corporation's fixed monthly expenses are $18,500 and its contribution margin ratio is 62%.…

A: Contribution margin is calculated as excess of sales price over variable expenses. Net income is…

Q: Operating income for PQR company is $20,000, variable cost per unit is $6, number of units sold are…

A: Unit Contribution margin = Selling price - Unit Variable cost = $10 - $6 = $4   Contribution margin…

Q: A firm has revenues of $150,000, a contribution margin ratio of 35%, and fixed expenses that total…

A: So answer is operating income increase by $10500 Fixed expenses do not change in change in revenue.…

Q: Jely Company manufactures a single product. In the prior year, the company had sales of P90,000,…

A: Variable cost changes with the changing level of activities i.e. higher the production more will be…

Q: Westerville Company reported the following results from last year’s operations: Sales $ 1,200,000…

A: 5. Turnover = $240,000$150,000=1.6

Q: Chico's has sales of 15,000 units at a price of $20 per unit. The firm incurs fixed operating costs…

A: Sales Quantity is 15,000 units Sales Price is $20 per unit Fixed Operating cost is $30,000 Base…

Q: Westerville Company reported the following results from last year's open Sales Variable expenses…

A: Turnover = Sales/Average operating assets

Q: For the current year ending April 30, MJW Company expects fixed costs of $87,500; a unit variable…

A: Break Even Point - Break Even point is the point where the company recovered its cost. It is the not…

Q: Variable costs as a percentage of sales for Lemon Inc. are 60%, current sales are $518,000, and…

A: Calculate the amount of increase in variable cost:If sales get increased by $43,100,Variable cost…

Q: Tennill Inc. has a $1,400,000 investment opportunity with the following characteristics: Sales $…

A: Formula: ROI = Turnover x Margin

Q: Your Corporation’s contribution margin ratio is 29% and it’s fixed monthly expenses are $17,000. If…

A: Break-even analysis is a technique used widely by production management. It helps to determine the…

Q: The following information relates to financial projections of ABC's company: Projected sales 60,000…

A: Contribution margin = (sales price - variable costs) x no. of units = (7-2)*60000 = P300000

Q: A company expects to sell 30,000 units of a product next year. Variable production cost is ₱25 and…

A: Number of units = 30,000 Variable Cost per unit = 25 Variable Production Costs = Variable Cost per…

Q: Kuzio Corporation produces and sells a single product. Data concerning that product appear below:…

A: Cost volume profit analysis is the technique used by the management for decision-making. The methods…

Q: Matthew’s Fish has a monthly target operating income of $6,800.  Variable expenses are 70% of sales…

A: Degree of operating leverage (DOL): DOL reflects  variable and fixed cost relationship of an…

Q: Reliance fresh has planned operating expenses of ₹170,000, a profit goal of₹35,000, and it expects…

A: Working Note :-                           Calculation of Cost Of Goods Sold Particulars Budgeted…

Q: Westerville Company reported the following results from last year’s operations:   Sales $…

A: 1. Margin related to this year’s investment opportunity = Net operating income/Sales Net operating…

Q: Light Me Up Lamps has variable expenses of​ 30% of sales and monthly fixed expenses of​ $140,000.…

A: Operating income involves the income generated by normal business transactions. This means the…

Q: Assume that the operating results for last year were as follows: Sales $360,000 Less: Variable…

A: Formula: Operating leverage = Contribution margin / Net operating income

Q: Salt Corporation's contribution margin ratio is 75% and its fixed monthly expenses are $55,000.…

A: Formula: Net operating income = Contribution margin value - Fixed expenses. Deduction of fixed…

Q: Best Sleep Company reported the following results from last year's operations: Sales $ 1,500,000…

A: Net operating income (investment opportunity)=Contribution-Fixed cost=$240,000×70%-$144,000=$24,000

Q: STERLING TIRE COMPANY Income Statement For the Year Ended December 31, 2013 Sales (30,000 tires at…

A: Break even refers to the situation of no profit and no loss. At the point of break even, business is…

Q: Pankey Inc. has a $700,000 investment opportunity that would involve sales of $1,050,000, a…

A: Contribution = Sales x contribution margin ratio Operating Income = Contribution - Fixed expenses…

Q: PB&J Eatery has a monthly target operating income of $6,300. Variable expenses are 60% of sales and…

A: Operating leverage = Contribution margin / Operating income where, Contribution margin = Operating…

Q: Peterson Manufacturing is evaluating two different operating structures which are described below.…

A: answar 1.(x)  EBIT and EPS in both the structures Operating structure 1   10000 units 20000 units…

Q: Variable costs as a percentage of sales for Lemon Inc. are 64%, current sales are $691,000, and…

A: CVP analysis is considered a decision-making tool that helps management to make strategies and take…

Q: Boom Company has sales volume of 70,000 units with a unit selling price of $120 per unit. The…

A: 15. Formula for calculating Degree of Operating Leverage is as follows: Formula = Contribution…

Q: Atlas Company has a monthly target operating income of $2 expenses are 60% of sales and monthly…

A: Option (b) 1.57 is the correct answer.   Solution: Contribution =  Target Income + Fixed Cost…

Q: Company XYZ is currently making sales of $ 200,000, At this level, the variable expenses were $…

A: Formula: Contribution margin = Sales - variable expenses Deduction of variable expenses from sales…

Q: 4 Atlas Company has a monthly target operating income of $20,000. Variable expenses are 60% of sales…

A: The measure that computed the degree by which the organization can increase the operating income by…

Q: Oxygen Co. has the following forecasted data for 2020 Forecast sales in units…

A: The break even point is the level of sales at which there is no profit and loss. The degree of…

Q: Your Company's fixed expenses total $150,000, its variable expense ratio is 60% and its variable…

A: The total costs incurred during a period can be further classified into fixed costs and variable…

Q: 1. Assume that the contribution margin ratio of the investment opportunity was 65% instead of 70%.…

A: Solution:- 1)Calculations if  the contribution margin ratio of the investment opportunity was 65%…

Q: Harley Company has sales of $500,000, variable costs are 75% of sales, and income from operations is…

A: Operating leverage is a method of measuring the degree to which a firm can increase its operating…

Q: If selling price per unit is $30, variable costs per unit are $20, total fixed costs are $10,000,…

A: Net income - It is also known as net profit, it is the amount that is left after deducting all the…

Variance Analysis

In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance. 

Standard Costing

The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.