Oakbrook, Inc. reported actual sales of $2,000,000, and fixed costs of $350,000. The contribution margin ratio is 25%. Compute the margin of safety in dollars and the margin of safety ratio. Margin of safety in dollar $ Margin of safety ratio eTextbook and Media
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A: Contribution Margin: The process or theory which is used to judge the benefit given by each unit of…
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A: Contribution margin: Contribution margin is a difference between the sales and the variable cost, it…
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A: Break even point (BEP): Breakeven is the point where total expenses are equal to total revenue. at…
Q: Last period Hartig Corporation sold 40.000 units, total sales were $303,000, total variable expenses…
A: Contribution margin ratio = Contribution margin / Sales where, Contribution margin = Sales -…
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A: Introduction: Margin of safety : Deduction of break even sales from Actual sales derives the Margin…
Q: The Ganbatte year end operating results were as follows: Total Sales of $750.000 Operated at 75% of…
A: BEP is Break even point revenue in business at which business is only recovering it's total costs…
Q: Orion recently reported sales revenues of $800,000, a total contribution margin of $300,000, and…
A: Total variable cost=Sales-Contribution=$800,000-$300,000=$500,000
Q: At a volume of 20,000 units, Dries reported sales revenues of $1,000,000, variable costs of…
A: Cost Accounting: It is the process of collecting, recording, analyzing the cost, summarizing cost,…
Q: At a level of 20,420 units sold, Lee Corp. has sales of $653,600, a contribution margin ratio of…
A: Contribution =Sales×Contribution margin ratio=$653,600×58%=$379,088
Q: Oslo Company prepared the following contribution format income statement based on a sales volume of…
A: Contribution margin ratio = Contribution margin / sales = 8000/12000 = 66.67%
Q: A company with a break-even point at $900,000 in sales revenue and had fixed costs of $225,000. When…
A: Margin of safety: It is the sale over and above break even point. Profit is earned on this sale.…
Q: Last month when Holiday Creations, Incorporated, sold 41.000 units, total sales were $164,000, total…
A: Formula: Contribution margin ratio = ( Contribution margin / Total sales ) x 100
Q: a. Young Company budgets sales of $1,120,000, fixed costs of $55,400, and variable costs of…
A: Contribution margin = sales - variable costs = $1120000-246400 = $873,600
Q: A company has sales of $1,000,000, variable costs of $250,000, and fixed costs of $600,000. Compute…
A:
Q: Oslo Company prepared the following contribution format income statement based on a sales volume of…
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Q: Stockmaster Corporation has provided the following contribution format income statement. Assume that…
A: A margin of safety is a built-in cushion that allows for some losses to occur without having a…
Q: Oslo Company prepared the following contribution format income statement based on a sales volume of…
A: The margin of safety is the excess value of the amount the firm earns over its break-even sales. It…
Q: A recent income statement of Nixon Corporation reported the following data: Sales revenue P…
A: Contribution margin means sales revenue earned by the business over and above its variable costs.…
Q: Patriot Corp has the following contribution format income statement. (Assume all information is…
A: Margin of safety (in dollars)= Total sales - Break even sales
Q: slo Company prepared the following contribution format income statement based on a sales volume of…
A: The break even sales units are calculated as fixed cost divided by Contribution margin per unit.…
Q: The total sales revenue of Black Stone Crushing Company was $150,000 for the last year. The fixed…
A: We have the following information: Total Sales Revenue: $150,000 Variable Expenses:Manufacturing:…
Q: Stancil Dry Cleaners has determined the following about its costs: Total variable expenses…
A: Contribution margin ratio = Total fixed expenses / Sales revenue needed to break even
Q: Stancil Dry Cleaners has determined the following about its costs: Total variable expenses…
A:
Q: Orion recently reported sales revenues of OMR 83000, a total contribution margin of OMR 24000, and…
A: The answer is as fallows
Q: Company XYZ made total sales revenue of $300,000. The variable manufacturing costs were $95,000…
A: Contribution = selling price - variable cost
Q: Bryce Co. sales are $828,000, variable costs are $460,500, and operating income is $294,000. The…
A: The contribution margin ratio is the difference between sales and variable cost. It indicates the…
Q: Company XYZ made total sales revenue of $450,000. The variable manufacturing costs were $125,000…
A: Contribution Margin = Sales revenue - Variable Expenses Contribution Margin is difference between…
Q: Company XYZ made total sales revenue of $400,000. The variable manufacturing costs were $115,000…
A: Contribution Margin is difference between net product revenue and variable expenses. It is used to…
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A: Total production costs are the costs incurred for the production or manufacture of the goods.
Q: Idaho Corp. has fixed costs of $20,000 and a contribution margin ratio of 50%. Currently, sales are…
A: Margin of Safety: The margin of safety is a notion in investing that states that investor should…
Q: Oslo Company prepared the following contribution format income statement based on a sales volume of…
A: “Since you have posted a question with multiple sub-parts, we will solve first three sub-parts for…
Q: Compute (a) the margin of safety in dollars and (b) the margin of safety ratio with the given…
A: Margin of safety can termed as an difference between the sales of an product and break-even sales.
Q: ABC Manufacturing Corporation provides the following estimated data: Sales Rs. 950,000 Fixed…
A: At the break-even point, all the expenses are equal to all the revenues generated. In other words,…
Q: sales revenue is $35,000, fixed cost is $5,000, and net operation income is $10,000, what is the…
A: The contribution margin is calculated by deducting the variable cost from the sales revenue of the…
Q: Current operating income for Bay Area Cycles Co. is $22,000. Selling price per unit is $100, the…
A: Break even sales is that level of sale at which there is no profit and loss and the margin of safety…
Q: Sunn Company manufactures asingle product that sels for $130 per unt and whose variable costs are…
A: Formula: Contribution margin per unit = Selling price per unit -Variable cost per unit
Q: A company has sales of $125,000, variable costs of $45,000 and fixed costs of $30,000. The…
A: Given that, sales = $125000 Variable cost = $45000 Fixed cost = $30000
Q: At a volume of 20,000 units, Drees reported sales revenues of $1,000,000, variable costs of…
A: At a volume of 20,000 units, Drees reported sales revenues of $1,000,000, variable costs of…
Q: A company with a break-even point at $900,000 in sales revenue had fixed costs of $175,000. When…
A: Margin of safety ( in $) = Actual Sales - Breakeven sales
Q: Colton Dry Cleaners has determined the following about its costs: Total variable expenses are…
A: Contribution Margin Ratio = Total Fixed Cost Break-Even Sales * 100 Variable Cost Ratio = 100 -…
Q: At a volume of 25,000 units, Almount Industries reported sales revenues of $1,300,000, variable…
A: Cost Accounting: It is the process of collecting, recording, analyzing the cost, summarizing cost,…
Q: Oslo Company prepared the following contribution format income statement based on a sales volume of…
A:
Q: Company XYZ made total contribution margin of $200,000 and a net income of $150,000. The company…
A: Contribution = Fixed cost + Net profit
Q: Imelda Company budgets sales of $1,800,000, fixed costs of $394,000, and variable costs of…
A: The contribution margin is calculated as excess of sales revenue over variable cost.
Q: At a volume of 20,000 units, Drees reported sales revenues of $1,000,000, variable costs of…
A: Total contribution=Sale-Variable costs=$1,000,000-$300,000=$700,000
Q: a. Imelda Company budgets sales of $1,800,000, fixed costs of $394,000, and variable costs of…
A: Contribution margin ratio = (Total contribution/sales) ×100
Q: In the last reporting period, Helena's Heavenly Fixture Company recorded 80,000 units sold for the…
A: Contribution Margin: Contribution margin is the selling price of a product. It represents the money…
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- Margin of safety Jorgensen Company has sales of 380,000,000, and the break-even point in sales dollars is 323,000,000. Determine Jorgensen Companys margin of safety as a percent of current sales.Bradshaw Company reported sales of 5,000,000 in 20X1. At the end of the fiscal year (June 30, 20X1), the following quality costs were reported: Required: 1. Prepare a quality cost report. 2. Prepare a graph (pie chart or bar graph) that shows the relative distribution of quality costs, and comment on the distribution. 3. Assuming sales of 5,000,000, by how much would profits increase if quality improves so that quality costs are only 3% of sales?Evans Company had total sales of 3,000,000 for fiscal 20x5. The costs of quality-related activities are given below. Required: 1. Prepare a quality cost report, classifying costs by category and expressing each category as a percentage of sales. What message does the cost report provide? 2. Prepare a bar graph and pie chart that illustrate each categorys contribution to total quality costs. Comment on the significance of the distribution. 3. What if, five years from now, quality costs are 7.5 percent of sales, with control costs being 65 percent of the total quality costs? What would your conclusion be?
- The sales price per unit is 13 for the Voyageur Companys only product. The variable cost per unit is 5. In 2016, the company sold 80,000 units, which was 10,000 units above the break-even point. Compute the following: 1. Total fixed expenses. (Hint: First compute the contribution margin per unit.) 2. Total variable expense at the break-even volume.Sports-Reps, Inc., represents professional athletes and movie and television stars. The agency had revenue of 12,345,000 last year, with total variable costs of 5,678,700 and fixed costs of 2,192,400. Required: 1. What is the contribution margin ratio for Sports-Reps based on last years data? What is the break-even point in sales revenue? 2. What was the margin of safety for Sports-Reps last year? 3. One of Sports-Repss agents proposed that the firm begin cultivating high school sports stars around the nation. This proposal is expected to increase revenue by 230,000 per year, with increased fixed costs of 122,500. Is this proposal a good idea? Explain.Suppose that a company is spending 60,000 per year for inspecting, 30,000 for purchasing, and 40,000 for reworking products. A good estimate of nonvalue-added costs would be a. 70,000. b. 130,000. c. 40,000. d. 90,000. e. 100,000.
- Faldo Company produces a single product. The projected income statement for the coming year, based on sales of 200,000 units, is as follows: Required: 1. Compute the unit contribution margin and the units that must be sold to break even. Suppose that 30,000 units are sold above the break-even point. What is the profit? 2. Compute the contribution margin ratio and the break-even point in dollars. Suppose that revenues are 200,000 greater than expected. What would the total profit be? 3. Compute the margin of safety in sales revenue. 4. Compute the operating leverage. Compute the new profit level if sales are 20 percent higher than expected. 5. How many units must be sold to earn a profit equal to 10 percent of sales? 6. Assume the income tax rate is 40 percent. How many units must be sold to earn an after-tax profit of 180,000?Garrett Company provided the following information: Common fixed cost totaled 46,000. Garrett allocates common fixed cost to Product 1 and Product 2 on the basis of sales. If Product 2 is dropped, which of the following is true? a. Sales will increase by 300,000. b. Overall operating income will increase by 2,600. c. Overall operating income will decrease by 25,000. d. Overall operating income will not change. e. Common fixed cost will decrease by 27,600.Klamath Company produces a single product. The projected income statement for the coming year is as follows: Required: 1. Compute the unit contribution margin and the units that must be sold to break even. 2. Suppose 10,000 units are sold above break-even. What is the operating income? 3. Compute the contribution margin ratio. Use the contribution margin ratio to compute the break-even point in sales revenue. (Note: Round the contribution margin ratio to four decimal places, and round the sales revenue to the nearest dollar.) Suppose that revenues are 200,000 more than expected for the coming year. What would the total operating income be?
- Fire Company is a service firm with current service revenue of $900,000 and a 40% contribution margin. Its fixed costs are $200,000. Ice Company has current sales of $420,000 and a 30% contribution margin. Its fixed costs are $90,000. What is the margin of safety for Fire and Ice? Compare the margin of safety in dollars between the two companies. Which is stronger? Compare the margin of safety in percentage between the two companies. Now which one is stronger? Compute the degree of operating leverage for both companies. Which company will benefit most from a 10% increase in sales? Explain why. Illustrate your findings in an Income Statement that is increased by 10%.Schylar Pharmaceuticals, Inc., plans to sell 130,000 units of antibiotic at an average price of 22 each in the coming year. Total variable costs equal 1,086,800. Total fixed costs equal 8,000,000. (Round all ratios to four significant digits, and round all dollar amounts to the nearest dollar.) Required: 1. What is the contribution margin per unit? What is the contribution margin ratio? 2. Calculate the sales revenue needed to break even. 3. Calculate the sales revenue needed to achieve a target profit of 245,000. 4. What if the average price per unit increased to 23.50? Recalculate: a. Contribution margin per unit b. Contribution margin ratio (rounded to four decimal places) c. Sales revenue needed to break even d. Sales revenue needed to achieve a target profit of 245,000Cadre, Inc., sells a single product with a selling price of $120 and variable costs per unit of $90. The companys monthly fixed expenses are $180,000. What is the companys break-even point in units? What is the companys break-even point in dollars? Prepare a contribution margin income statement for the month of October when they will sell 10,000 units. How many units will Cadre need to sell in order to realize a target profit of $300,000? What dollar sales will Cadre need to generate in order to realize a target profit of $300,000? Construct a contribution margin income statement for the month of August that reflects $2,400,000 in sales revenue for Cadre, Inc.