Medina Company produces a single product. The projected income statement for the Sales (68,000 units @ $19.00) $1,292,000 Total variable cost 852,720 Contribution margin $ 439,280 Total fixed cost 426,360 Operating income $ 12,920 Required: 1. Compute the break-even sales dollars. 1,254,000 2. Compute the margin of safety in sales dollars. 2,000 3. Compute the degree of operating leverage. 34 4. Compute the new operating income if sales are 20% higher than expected. 100,776
Medina Company produces a single product. The projected income statement for the Sales (68,000 units @ $19.00) $1,292,000 Total variable cost 852,720 Contribution margin $ 439,280 Total fixed cost 426,360 Operating income $ 12,920 Required: 1. Compute the break-even sales dollars. 1,254,000 2. Compute the margin of safety in sales dollars. 2,000 3. Compute the degree of operating leverage. 34 4. Compute the new operating income if sales are 20% higher than expected. 100,776
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter6: Cost-volume-profit Analysis
Section: Chapter Questions
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