EP FINANCIAL+MANAGERIAL ACCT. >CUSTOM<
5th Edition
ISBN: 9781323590287
Author: *ST.LEO UNIV.
Publisher: PEARSON C
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Question
Chapter 20, Problem 16RQ
To determine
Identify which of three approaches of target profit is used to calculate the required sales in units and to calculate the required sales in dollars.
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compute for the following items:
d. Contribution margin ratio
e. Breakeven point in pesos
f. Breakeven point in unit sales
When a company sells multiple products, the breakeven point in sales dollars is computed by:
Once a company exceeds its breakeven level, operating income can be calculated by multiplying:
a. The sales price by unit sales in excess of breakeven units.
b. Unit sales by the difference between the sales price and fixed cost per unit.
c. The contribution margin ratio by the difference between unit sales and breakeven sales.
d. The contribution margin per unit by the difference between unit sales and breakeven sales.
Chapter 20 Solutions
EP FINANCIAL+MANAGERIAL ACCT. >CUSTOM<
Ch. 20 - Following is a list of costs for a furniture...Ch. 20 - Following is a list of costs for a furniture...Ch. 20 - Prob. 3TICh. 20 - Following is a list of costs for a furniture...Ch. 20 - Following is a list of costs for a furniture...Ch. 20 - Prob. 6TICh. 20 - Prob. 7TICh. 20 - Prob. 8TICh. 20 - Prob. 9TICh. 20 - Prob. 10TI
Ch. 20 - Prob. 11TICh. 20 - Prob. 12TICh. 20 - Prob. 13TICh. 20 - Prob. 14TICh. 20 - Prob. 15TICh. 20 - Prob. 16TICh. 20 - Prob. 17TICh. 20 - Prob. 18TICh. 20 - A furniture manufacturer specializes in wood...Ch. 20 - For Franks Funky Sounds, straight-line...Ch. 20 - Assume Intervale Railway is considering hiring a...Ch. 20 - If Intervale Railways fixed costs total 90,000 per...Ch. 20 - If Intervale Railways fixed costs total 90,000 per...Ch. 20 - If Intervale Railways fixed costs total 90,000 per...Ch. 20 - On a CVP graph, the total cost line intersects the...Ch. 20 - If a company increases its sales price per unit...Ch. 20 - If a company increases its fixed costs for Product...Ch. 20 - Prob. 9QCCh. 20 - Rocky Mountain Waterpark sells half of its tickets...Ch. 20 - What is a variable cost? Give an example.Ch. 20 - What is a fixed cost? Give an example.Ch. 20 - What is a mixed cost? Give an example.Ch. 20 - What is the purpose of using the high-low method?Ch. 20 - Describe the three steps of the high-low method.Ch. 20 - Prob. 6RQCh. 20 - Prob. 7RQCh. 20 - Prob. 8RQCh. 20 - Prob. 9RQCh. 20 - What are the three ways contribution margin can be...Ch. 20 - Prob. 11RQCh. 20 - What is cost-volume-profit analysis?Ch. 20 - What are the CVP assumptions?Ch. 20 - What is the breakeven point?Ch. 20 - Prob. 15RQCh. 20 - Prob. 16RQCh. 20 - Prob. 17RQCh. 20 - Why is the calculation to determine the target...Ch. 20 - Prob. 19RQCh. 20 - What is sensitivity analysis? How do managers use...Ch. 20 - What effect does an increase in sales price have...Ch. 20 - Prob. 22RQCh. 20 - What is the margin of safety? What are the three...Ch. 20 - What is a companys cost structure? How can cost...Ch. 20 - What is operating leverage? What does it mean if a...Ch. 20 - Prob. 26RQCh. 20 - Philadelphia Acoustics builds innovative speakers...Ch. 20 - Hollys Day Care has been in operation for several...Ch. 20 - Mark owns a machine shop. In reviewing the shops...Ch. 20 - Glenn Company sells a product for 80 per unit....Ch. 20 - Gabelman Company sells a product for 95 per unit....Ch. 20 - Mackler, Inc. sells a product with a contribution...Ch. 20 - Ocean Company sells a product with a contribution...Ch. 20 - Compute the missing amounts for the following...Ch. 20 - Compute the missing amounts for the following...Ch. 20 - Use the following information to complete Short...Ch. 20 - Compute Funday Parks contribution margin ratio....Ch. 20 - Using the Funday Park information presented, do...Ch. 20 - Prob. 13SECh. 20 - Refer to the original information (ignoring the...Ch. 20 - Refer to the original information (ignoring the...Ch. 20 - Prob. 16SECh. 20 - For 2019, Wild Waters expects a sales mix of four...Ch. 20 - Match the following terms with the correct...Ch. 20 - Identify each cost as variable (V), fixed (F), or...Ch. 20 - For each total fixed cost listed below, determine...Ch. 20 - Prob. 21ECh. 20 - Prob. 22ECh. 20 - The manager of Trusty Car Inspection reviewed the...Ch. 20 - For its top managers, Worldwide Travel formats its...Ch. 20 - Complete the table below for contribution margin...Ch. 20 - Prob. 26ECh. 20 - Prob. 27ECh. 20 - Owner Shan Mu is considering franchising her...Ch. 20 - Prob. 29ECh. 20 - Prob. 30ECh. 20 - Determine how each change effects the elements of...Ch. 20 - Mi Tierra Driving School charges 680 per student...Ch. 20 - Prob. 33ECh. 20 - Robbies Repair Shop has a monthly target profit of...Ch. 20 - Prob. 35ECh. 20 - Prob. 36ECh. 20 - The budgets of four companies yield the following...Ch. 20 - England Productions performs London shows. The...Ch. 20 - Crandall Company sells flags with team logos....Ch. 20 - Prob. 40APCh. 20 - The contribution margin income statement of Sugar...Ch. 20 - The budgets of four companies yield the following...Ch. 20 - Famous Productions performs London shows. The...Ch. 20 - White Company sells flags with team logos. White...Ch. 20 - Diversified Investor Group is opening an office in...Ch. 20 - The contribution margin income statement of...Ch. 20 - Prob. 48PCh. 20 - The Jacksonville Shirt Company makes two types of...Ch. 20 - Prob. 1TIATCCh. 20 - Steve and Linda Hom live in Bartlesville,...Ch. 20 - Prob. 1EI
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Similar questions
- The dollar amount of sales needed to achieve a target operating income is computed by dividingbtarget operating income by the contribution margin ratio True Falsearrow_forwardWhich of the following ratios indicates the percentage of each sales dollar that is available to cover fixed costs and to provide a profit? a. costs and expenses ratio b. contribution margin ratio c. margin of safety ratio d. profit ratioarrow_forwardOnce a company exceeds its breakeven level, operating income can be calculated by multiplying: The sales price by unit sales in excess of breakeven units. Unit sales by the difference between the sales price and fixed cost per unit. The contribution margin ratio by the difference between unit sales and breakeven sales. The contribution margin per unit by the difference between unit sales and breakeven sales.arrow_forward
- Which one of the following is defined, at any given sales volume, as the ratio of the total contribution margin to operating profit at that sales volume?arrow_forwardCompute the breakeven point in units, assuming that the company achieves its planned sales mix.arrow_forwardWhat are the answers for the following? Construct a cost-volume-profit chart on your own paper. What is the break-even sales? What is the expected margin of safety in dollars and as a percentage of sales? Determine the operating leverage. Round to one decimal place.arrow_forward
- Which of the following equations is correct for determining the required sales in units to generate a targeted amount of pre-tax income (πB) under the equation method (where Q = sales in units, F = total fixed costs, πB = pre-tax profit, v = variable cost per unit, and p = selling price per unit)?arrow_forwardthe dollar amount of sales needed to achieve a target operating income is computed by whatarrow_forwardUsing a physical measurement method, what amount of joint processing cost is allocated to Mo (round to the nearest peso)? Using sales value at split-off, what amount of joint processing cost is allocated to Mo (round to the nearest peso)? Using net realizable value at split-off, what amount of joint processing cost is allocated to Bo (round to the nearest peso)?arrow_forward
- What ratio indicates the percentage of each sales dollar that is available to cover fixed costs and to provide a profit? A. Margin of safety ratioB. Contribution margin ratioC. Costs and expenses ratioD. Profit ratioarrow_forwardWhich of the following formulas is used to calculate the contribution margin ratio?(Sales − Fixed costs) ÷ Sales.(Sales − Total costs) ÷ Sales.(Sales − Cost of goods sold) ÷ Sales.(Sales − Variable costs) ÷ Sales.arrow_forwardPlease explain this statement thoroughly. "To estimate what the profit will be at various levels of activity, multiply the number of units to be sold above or below the break-even point by the unit contribution margin."arrow_forward
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