Soft Feathers, Inc., distributes a high-quality wooden birdhourse that sells for PhP1,000 per unit. Variable costs are PhP400 per unit, and fixed costs total PhP9,000,000 per year. Required: Answer the following questions: What is the product's CM ratio? 2. Use the CM ratio to determine the break-even point in sales amount. 3. Due to an increaes in demand, the company estimates that sales will increase by PhP3,750,000 during the next year. By how much should net operating income increase (or net loss decrease) assuming fixed costs do not change?
Soft Feathers, Inc., distributes a high-quality wooden birdhourse that sells for PhP1,000 per unit. Variable costs are PhP400 per unit, and fixed costs total PhP9,000,000 per year. Required: Answer the following questions: What is the product's CM ratio? 2. Use the CM ratio to determine the break-even point in sales amount. 3. Due to an increaes in demand, the company estimates that sales will increase by PhP3,750,000 during the next year. By how much should net operating income increase (or net loss decrease) assuming fixed costs do not change?
Chapter3: Cost-volume-profit Analysis
Section: Chapter Questions
Problem 5EB: Cadre, Inc., sells a single product with a selling price of $120 and variable costs per unit of $90....
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