Homework Help is Here – Start Your Trial Now!
Business
Accounting
Midlands Inc. had a bad year in 2019. For the first time in its history, it operated at a loss. The company's income statement showed the following results from selling 77,000 units of product: net sales $1.540,000; total costs and expenses $1,964,000; and net loss $424,000. Costs and expenses consisted of the following. Cost of goods sold Selling expenses Administrative expenses Manager Total Variable $1,299,600 $773,000 513,400 93,000 151,000 58,000 $1,964,000 $924,000 Fixed $526,600 420,400 93,000 $1,040,000

Midlands Inc. had a bad year in 2019. For the first time in its history, it operated at a loss. The company's income statement showed the following results from selling 77,000 units of product: net sales $1.540,000; total costs and expenses $1,964,000; and net loss $424,000. Costs and expenses consisted of the following. Cost of goods sold Selling expenses Administrative expenses Manager Total Variable $1,299,600 $773,000 513,400 93,000 151,000 58,000 $1,964,000 $924,000 Fixed $526,600 420,400 93,000 $1,040,000

Cornerstones of Cost Management (Cornerstones Series)
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter2: Basic Cost Management Concepts
Section: Chapter Questions
Problem 14E: For each of the following independent situations, calculate the missing values: 1. The Belen plant...
See similar textbooks
icon
Related questions
Question

Please help me with all answers thanku 

Midlands Inc. had a bad year in 2019. For the first time in its history, it operated at a loss. The company's income statement showed the following results from selling 77,000 units of product: net sales $1.540,000; total costs and expenses $1,964,000; and net loss $424,000. Costs and expenses consisted of the following. Cost of goods sold Selling expenses Administrative expenses 1. 2. Total $1,299,600 513,400 3. 151,000 Variable $773,000 93,000 58,000 Management is considering the following independent alternatives for 2020. Increase unit selling price 25% with no change in costs and expenses. Change the compensation of salespersons from fixed annual salaries totaling $198,000 to total salaries of $38,005 plus a 5% commission on net sales. $1,964,000 $924,000 Fixed $526,600 420,400 93,000 $1,040,000 Purchase new high-tech factory machinery that will change the proportion between variable and fixed cost of goods sold to 50:50. (a) Compute the break-even point in dollars for 2019. (Round contribution margin ratio to 4 decimal places eg. 0.2512 and final answer to 0 decimal places, e.g. 2,510)
Transcribed Image Text:Midlands Inc. had a bad year in 2019. For the first time in its history, it operated at a loss. The company's income statement showed the following results from selling 77,000 units of product: net sales $1.540,000; total costs and expenses $1,964,000; and net loss $424,000. Costs and expenses consisted of the following. Cost of goods sold Selling expenses Administrative expenses 1. 2. Total $1,299,600 513,400 3. 151,000 Variable $773,000 93,000 58,000 Management is considering the following independent alternatives for 2020. Increase unit selling price 25% with no change in costs and expenses. Change the compensation of salespersons from fixed annual salaries totaling $198,000 to total salaries of $38,005 plus a 5% commission on net sales. $1,964,000 $924,000 Fixed $526,600 420,400 93,000 $1,040,000 Purchase new high-tech factory machinery that will change the proportion between variable and fixed cost of goods sold to 50:50. (a) Compute the break-even point in dollars for 2019. (Round contribution margin ratio to 4 decimal places eg. 0.2512 and final answer to 0 decimal places, e.g. 2,510)
(a) Compute the break-even point in dollars for 2019. (Round contribution margin ratio to 4 decimal places eg. 0.2512 and final answer to O decimal places, e.g. 2,510.) Break-even point (b) Compute the break-even point in dollars under each of the alternative courses of action for 2020. (Round contribution margin ratio to 3 decimal places eg. 0.251 and final answers to O decimal places, eg. 2,510.) 1. 2 $ 3. Increase selling price $ Change compensation Purchase machinery $ $ Break-even point Which course of action do you recommend?
Transcribed Image Text:(a) Compute the break-even point in dollars for 2019. (Round contribution margin ratio to 4 decimal places eg. 0.2512 and final answer to O decimal places, e.g. 2,510.) Break-even point (b) Compute the break-even point in dollars under each of the alternative courses of action for 2020. (Round contribution margin ratio to 3 decimal places eg. 0.251 and final answers to O decimal places, eg. 2,510.) 1. 2 $ 3. Increase selling price $ Change compensation Purchase machinery $ $ Break-even point Which course of action do you recommend?
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Determination of Tax Liability
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Cornerstones of Cost Management (Cornerstones Ser…
Cornerstones of Cost Management (Cornerstones Ser…
Accounting
ISBN:
9781305970663
Author:
Don R. Hansen, Maryanne M. Mowen
Publisher:
Cengage Learning
Principles of Cost Accounting
Principles of Cost Accounting
Accounting
ISBN:
9781305087408
Author:
Edward J. Vanderbeck, Maria R. Mitchell
Publisher:
Cengage Learning
Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Excel Applications for Accounting Principles
Excel Applications for Accounting Principles
Accounting
ISBN:
9781111581565
Author:
Gaylord N. Smith
Publisher:
Cengage Learning
EBK CONTEMPORARY FINANCIAL MANAGEMENT
EBK CONTEMPORARY FINANCIAL MANAGEMENT
Finance
ISBN:
9781337514835
Author:
MOYER
Publisher:
CENGAGE LEARNING - CONSIGNMENT
Financial Reporting, Financial Statement Analysis…
Financial Reporting, Financial Statement Analysis…
Finance
ISBN:
9781285190907
Author:
James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Publisher:
Cengage Learning
SEE MORE TEXTBOOKS