Subject: Question 3 of 9View PoliciesShow Attempt HistoryCurrent Attempt in ProgressSalariesUtilitiesThe Soma Inn is trying to determine its break-even point. The inn has 75 rooms that are rented at $60 a night. Operating costs are asfollows.DepreciationMaintenanceMaid serviceOther costs1.<2.* Your answer is incorrect.$8,800 per month2,700 per month1,300 per month700per monthDetermine the inn's break-even point in (1) number of rented rooms per month and (2) dollars.81.2.34 per roomeTextbook and MediaBreak-even point in roomsBreak-even pointper room* Your answer is incorrect.Save for LaterMargin of safetyMargin of safety ratioeTextbook and MediaIf the inn plans on renting an average of 50 rooms per day (assuming a 30-day month), what is (1) the monthly margin of safety indollars and (2) the margin of safety ratio? (Round ratio to 0 decimal places, e.g. 10%.)$$54600105023400300/3per month%:Attempts: 1 of 2 used Submit Answer

BREAKEVEN POINTBreak Even means the volume of production or sales where there is no profit or…

Answered: per month per month per room per room…

per month per month per room per room rrect. even point in (1) number of rented rooms per month and (2) dollars. rooms rrect. $ 1050 54600 per month

Financial & Managerial Accounting

13th Edition

ISBN:9781285866307

Author:Carl Warren, James M. Reeve, Jonathan Duchac

Publisher:Carl Warren, James M. Reeve, Jonathan Duchac

Chapter27: Lean Principles, Lean Accounting, And Activity Analysis

Section: Chapter Questions

Problem 27.1BPR

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Question No. 2 CVP – Basic Analysis Raveen Products sells camping equipment. One of the company’s products, a camp lantern, sells for $90per unit. Variable expenses are $63 per lantern, and fixed expenses associated with the lantern total$135,000 per month.Required:1. Compute the company’s break-even point in number of lanterns and in total sales dollars.2. Compute the company’s Margin of Safety in sales dollar and in percentage.3. At present, the company is selling 8,000 lanterns per month. The sales manager is convinced thata 10% reduction in the selling price will result in a 25% increase in the number of lanterns soldeach month. Prepare two contribution format income statements, one under present operatingconditions, and one as operations would appear after the proposed changes. Show both total andper unit data on your statements.4. Refer to the data in (3) above. How many lanterns would have to be sold at the new selling priceto yield a minimum net operating income of $72,000 per…
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Question 5 (Marks: 30)Consider the info provided below as well as the financial statements and answer the questionsthat follow. Pearson & Litt is a manufacturing company in the Eastern Cape. Their factory manufactures glasswine bottles for the Blue Valley Beer Co. 2019 2020Sales price per unit R15 R19Variable cost per unit R6 R7Fixed cost (FC) per annum R650 000 R 855 500Fixed cost per unit R3 R4 Current assets R450 600 R560 700Current liabilities R510 000 R780 000Retained profit R21 809 R17 600Net Sales R2 900 320 R 3 100 100Cost of sales R390 000 R475 00018; 19; 20 2020© The Independent Institute of Education (Pty) Ltd 2020Page 11 of 12Q.5.1Q.5.1.1 Calculate the break‐even point for Pearson & Litt for 2019 and 2020. (7)Q.5.1.2 Compare the results of the 2019 and 2020 break‐even point and explainwhy there might be a difference.(3)Q.5.2 The current ratio reflects the relationship between the value of the current assetsand the extent of the current liabilities of a business.…
Ch. 8 Homework Question 7 (a) Please solve and explain the following problem. Shadee Corp. expects to sell 600 sun visors in May and 800 in June. Each visor sells for $18. Shadee’s beginning and ending finished goods inventories for May are 75 and 50 units, respectively. Ending finished goods inventory for June will be 60 units. Each visor requires a total of $4.00 in direct materials that includes an adjustable closure that the company purchases from a supplier at a cost of $1.50 each. Shadee wants to have 30 closures on hand on May 1, 20 closures on May 31, and 25 closures on June 30. Additionally, Shadee’s fixed manufacturing overhead is $1,000 per month, and variable manufacturing overhead is $1.25 per unit produced. Each visor takes 0.30 direct labor hours to produce and Shadee pays its workers $9 per hour. Additional information: Selling costs are expected to be 6 percent of sales.Fixed administrative expenses per month total $1,200. Determine Shadee's budgeted selling and…
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