Ozark Metal Co. makes a single product that sells for $43 per unit. Variable costs are $29.8 per unit, and fixed costs total $65,500 per month. Required: a. Calculate the number of units that must be sold each month for the firm to break even, b. Assume current sales are $406,000. Calculate the margin of safety and the margin of safety ratio. c. Calculate operating income if 6,700 units are sold in a month. d. Calculate operating income if the selling price is raised to $46 per unit, advertising expenditures are increased by $7,500 per month, and monthly unit sales volume becomes 7,400 units. e. Assume that the firm adds another product to its product line and that the new product sells for $21 per unit, has variable costs of $15 per unit, and causes fixed expenses in total to increase to $88,000 per month. Calculate the firm's operating income if 6,700 units of the original product and 4,900 units of the new product are sold each month. For the original product, use the selling price and variable cost data given in the problem statement. f. Calculate the firm's operating income if 3,800 units of the original product and 7,800 units of the new product are sold each month.

Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter3: Cost-volume-profit Analysis
Section: Chapter Questions
Problem 5EA: Maple Enterprises sells a single product with a selling price of $75 and variable costs per unit of...
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Please answer last 4 requiremnt i.e d,e,f and g
Ozark Metal Co. makes a single product that sells for $43 per unit. Variable costs are $29.8 per unit, and fixed costs total
$65,500 per month.
Required:
a. Calculate the number of units that must be sold each month for the firm to break even.
b. Assume current sales are $406,000. Calculate the margin of safety and the margin of safety ratio.
c. Calculate operating income if 6,700 units are sold in a month.
d. Calculate operating income if the selling price is raised to $46 per unit, advertising expenditures are increased by $7,500
per month, and monthly unit sales volume becomes 7,400 units.
e. Assume that the firm adds another product to its product line and that the new product sells for $21 per unit, has variable
costs of $15 per unit, and causes fixed expenses in total to increase to $88,000 per month. Calculate the firm's operating
income if 6,700 units of the original product and 4,900 units of the new product are sold each month. For the original
product, use the selling price and variable cost data given in the problem statement.
f. Calculate the firm's operating income if 3,800 units of the original product and 7,800 units of the new product are sold
each month.
g. Why operating income is different in parts e and f, even though sales totaled 11,600 units in each case.
Complete this question by entering your answers in the tabs below.
Required A
Required B
Required C
Required D
Required E
Required F
Required G
Transcribed Image Text:Please answer last 4 requiremnt i.e d,e,f and g Ozark Metal Co. makes a single product that sells for $43 per unit. Variable costs are $29.8 per unit, and fixed costs total $65,500 per month. Required: a. Calculate the number of units that must be sold each month for the firm to break even. b. Assume current sales are $406,000. Calculate the margin of safety and the margin of safety ratio. c. Calculate operating income if 6,700 units are sold in a month. d. Calculate operating income if the selling price is raised to $46 per unit, advertising expenditures are increased by $7,500 per month, and monthly unit sales volume becomes 7,400 units. e. Assume that the firm adds another product to its product line and that the new product sells for $21 per unit, has variable costs of $15 per unit, and causes fixed expenses in total to increase to $88,000 per month. Calculate the firm's operating income if 6,700 units of the original product and 4,900 units of the new product are sold each month. For the original product, use the selling price and variable cost data given in the problem statement. f. Calculate the firm's operating income if 3,800 units of the original product and 7,800 units of the new product are sold each month. g. Why operating income is different in parts e and f, even though sales totaled 11,600 units in each case. Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Required E Required F Required G
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