1. What is the break-Even-Point (BEP) in units for the ABC corporation?2. what is the BEP in dollars for the ABC corporation?3. What is the Target income in units for the ABC corporation?4. What is the Target income in dollars for the ABC company?5. What is the contribution Margin Ratio for the ABC company? For ABC corporation do some CVP analysis (Break-Even-Points and Target Income) per the data below using theExcel document to verify your responses by making thecells into green color. Then, answer some questions.Sales Revenue per unit: $2000COGS per unit: $550Total Fixed Expenses: $630,750Target Income: $400,000 Enter alternative values for fixed costs, contribution margin per unit,contribution margin ratio, and target net income in the first four boxes below.Then, recalculate and enter the new break-even and target income amountsbased on your revised assumptions; correct values will turn the last four boxesgreen.Total fixed costsContribution margin per unitContribution margin ratioTarget net incomeBreak-Even Point in UnitsBreak-Even Point in SalesUnits to Achieve Target IncomeSales to Achieve Target Income1,200,0001,2000.60600,0001,0002,000,0001,5003,000,000

In case of multiple sub-parts only the first 3 subparts are answered as per the…

Answered: 1. What is the break-Even-Point (BEP)…

Business

Accounting

1. What is the break-Even-Point (BEP) in units for the ABC corporation?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Net sales Less: Less: Less: Less: Net income XY CORPORATE SUMMARY REPORT CONTRIBUTION INCOME…

A: The process of collecting and presenting financial data about several business segments within a…

Q: Current Ratio. What effect would the following actions have on a firm's current ratio? Assume that…

A: The current ratio is a financial metric that measures a company's ability to cover its short-term…

Q: which of the following occurs if a company decreases its selling price per unit? a. net income…

A: The contribution margin is calculated as difference between sales and variable costs. The…

Q: The Marginal Revenue function for a company's product is: MR = 240000 - 22x where x equals the…

A: Total revenue is the total amount of goods and services sold. It is calculated by multiplying the…

Q: What is locals net profit margin?

A: Net profit margin =

Q: uestion 2 Which of the following occurs if a company increases its selling price per unit? (Assume…

A: The contribution margin is calculated as the difference between the sales and variable costs. The…

Q: Part E43 is used in one of Ran Corporation's products. The company's Accounting Department reports…

Q: Income statements for two different companies in the same industry are as follows: Required:1.…

A: Degree of operating leverage shows ratio between contribution margin and operating income of the…

Q: Company X is competing with company Y. These are their ratios: x y Profit Margin .144 .172 ROA…

A: Profit margin is the margin calculated by comparing the sale value with the cost associated with it.…

Q: total revenue

A: Definition: Marginal Cost: It is a technique that solves the managerial problems and helps in…

Q: A firm has a tax burden ratio of 0.85, a leverage ratio of 1.25, an interest burden of 0.7, and a…

A: The conceptual formula is represented mathematically:

Q: What will be the operating profit ratio, if operating ratio is 88.34%?

A: We have the following information: Operating Ratio: 88.34%

Q: Fill in the blanks for each independent situation. A B $350,000 $ Sales Variable expense Fixed…

A: Cost volume profit analysis is the one which is prepared by the entity in order to determine the…

Q: During the current year, XYZ Company increased its variable SG&A expenses while keeping fixed SG&A…

A: The objective of the question is to understand the impact of an increase in variable Selling,…

Q: NUBD Inc. ignored the effect of income taxes in its calculation of the sales volume needed to…

A: If the company considers an impact of income tax in calculating the sales volume needed to achieve…

Q: 5. The contribution nmargin ratio measures the effect on the total contribution margin of a given…

A: Hey there since you have posted multiple questions, we can answer only first three questions, please…

Q: Is a current ratio of 0.4 good or bad for the company?

A: Current ratio: Current ratio measures short term solvency of firm. It meausres the ability of…

Q: Gallop Corporation prepared the following report for the first quarter of this year: Sales (@ $3,00…

A: Cost of goods sold and selling expense includes part of fixed cost. Units sold= 8400000/3000= 2800…

Q: e the company's overall profit if it sells exactly the break-even qua

A: Breakeven Point is a point at which the company makes no profit or loss. It is where the…

Q: iv) Why are two break-even points in the above diagram?

A: The vertical distance between TR and TC measures the profit or loss associated with any specific…

Q: Which of the following statements is true? 1. For a capital intensive, automated company the…

A: The relationship between sales volume, expenses, and profits is examined using the management…

Q: Questions: 1.) How many people should attend the seminar to break-even? 2.) Given this BEP number,…

A: We will use the BEP analysis here. BEP analysis refers to breakeven point analysis.

Q: A firm has a tax burden ratio of 0.85, a leverage ratio of 1.5, an interest burden of 0.9, and a…

A: The conceptual formula is represented mathematically:

Q: 1. how would a cost volume profit analysis would be performed for a company that sells more than one…

A: Having an understanding of CVP analysis The breakeven point for various sales volumes and cost…

Q: If a company had a pure fixed cost structure, every dollar of revenue after covering the fixed costs…

A: Step 1 In the pure fixed cost structure, the variable cost does not exist; only fixed cost hit the…

Q: The following table contains information about Wal-Mart (WMT) and Nordstrom (JWN). Compute their…

A: According to the DuPont analysis the determinants of return on equity (ROE) are (1) Net profit…

Q: Please answer all. From a company we get the following: Capital employed 20,000,000 dollar Debt /…

A: "Since you have posted a question with multiple sub-parts, we will solve first three sub-parts for…

Q: Let’s say that two firms, A and B have positive profit margins. B’s fixes costs as a percentage of…

A: Fixed costs are expenses that do not change based on production levels; variable costs are expenses…

Q: When sales volume increases, which company will experience a larger percentage increase in profit:…

A: Cost Volume Profit Analysis (CVP Analysis): This analysis is helpful in determining that how any…

Q: Net Sales Cost of Goods Sold Gross Profit Operating Expenses Company a courtertop instaler S764,500…

A: Return on invetsment = Net profit / Owner*s equity

Q: How can the contribution margin be used to determine the profitability of Ford Motor Company's…

A: While determining the profitability of the organisation first to find out the total contribution…

Q: Discuss the concept of cost of goods sold. Why is it so important? What is the downside for you, as…

A: 1 a Cost of goods sold (COGS) is a key concept in accounting that refers to the cost of the goods…

Q: Which of the following statements is true with respect to the degree of operating leverage (DOL)?…

A: Degree of Operating Leverage: It shows how much the operating income changes with respect to change…

Q: A company produces and sells a product. The company has found that the costto produce x units of the…

A: The objective of the question is to find the number of units the company should produce and sell to…

Q: The degree of operating leverage Select one: O a. can be computed by dividing total contribution…

A: Leverage is the risk that a company bears.

Q: When using the contribution margin ratio, managers project operating income based upon sales units.…

A: Operating income represents the total earnings of a firm after reducing all the operating costs from…

Q: A firm has a cost function C(x)=10x+107, where x represents the number of units produced. the firm's…

A: Variables in the question: Cost function: C(x)=10x+107Revenue function: R(x)=38x

Q: Suppose the wage rate is $10 and the rental rate on capital is $20. Consider the total cost line…

A: Solution- Vertical axis intercept=Total CostCapital Price…

Q: What is NUBD’s degree of operating leverage?

A: Degree of operating leverage shows how operating income of the business will change as a, result of…

Q: If a firm is able to sustain the same level of operations in terms of sales and administrative…

A: If a firm is able to sustain the same level of operations in terms of sales and administrative…

Q: s a consultant to Basso Inc., you have been provided with the following data: D1 = $0.68; P0 =…

A: To arrange the funds for the new investments or operations, firm offered various securities like…

Q: Sun Corporation has provided the following contribution format income statement. All questions…

A: Margin of safety under the cost volume profit analysis is the difference between the total sales…

Q: The break-even point is that at which: Select one: O A. The level of activity at which the business…

A: Solution:- Break-even point is the point where the total costs of a business are equal to the total…

Q: The following data applies to a firm: Interest charges=P50,000.00; Sales = P300,000.00; Tax…

A: Here in this case we are required to calculate interest covered ratio. We first need to understand…

Q: 1. The function of a company's product to produce output at the level of input use is Q=-1/3x3 +9x3…

A: Introduction Output Price The output price index estimates the average change in price of all…

Q: 7. Responsibility Accounting: a. What is a cost center? Give an example of a cost center b. What is…

A: Disclaimer: “Since you have posted a question with multiple sub-parts, we will solve first three…

Question

1. What is the break-Even-Point (BEP) in units for the ABC corporation?

2. what is the BEP in dollars for the ABC corporation?

3. What is the Target income in units for the ABC corporation?

4. What is the Target income in dollars for the ABC company?

5. What is the contribution Margin Ratio for the ABC company?

For ABC corporation do some CVP analysis (Break-Even-
Points and Target Income) per the data below using the
Excel document to verify your responses by making the
cells into green color. Then, answer some questions.
Sales Revenue per unit: $2000
COGS per unit: $550
Total Fixed Expenses: $630,750
Target Income: $400,000

Enter alternative values for fixed costs, contribution margin per unit,
contribution margin ratio, and target net income in the first four boxes below.
Then, recalculate and enter the new break-even and target income amounts
based on your revised assumptions; correct values will turn the last four boxes
green.
Total fixed costs
Contribution margin per unit
Contribution margin ratio
Target net income
Break-Even Point in Units
Break-Even Point in Sales
Units to Achieve Target Income
Sales to Achieve Target Income
1,200,000
1,200
0.60
600,000
1,000
2,000,000
1,500
3,000,000

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1: Concept

VIEW

Step 2: Requirement 1

VIEW

Step 3: Requirement 2

VIEW

Step 4: Requirement 3

VIEW

Solution

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 5 steps with 4 images

SEE SOLUTION Check out a sample Q&A here

Similar questions

The Marine Division of Pacific Corp. has average invested assets of $120,000,000. Sales revenue of $50,210,000 results in an operating income of $9,964,000. The hurdle rate is 8%. a. Calculate the return on investment. (Round your answer to 2 decimal places.) Raun mant b. Calculate the profit margin. (Round your answer to 2 decimal places.) c. Calculate the investment turnover. (Round your answer to 4 decimal places.) Next >
Use the following information to answer #7 and # 8 An investment banker is analyzing two companies as possible investments, but is concerned about the impact that each company's cost structure might have on its profitability. The following CVP income statements are available for Chantal Corp. and Mantle, Inc. Chantal Corp. Mantle, Inc. Sales revenue $700,000 $700,000 Variable costs 350,000 487,500 Contribution margin 350,000 212,500 Fixed costs 225.000 87,500 Net income $125,000 $125.000 If sales decrease by 20% for each company, the impact on net income will be: a decrease of 10% for Chantal and a decrease of 14% for Mantle. O a decrease of 20% for Chantal and a decrease of 20% for Mantle. O a decrease of 56% for Chantal and a decrease of 34% for Mantle. O a decrease of 56% for Chantal and a decrease of 78% for Mantle.
f net profit of the firm is OMR 280,000 and capital employed is OMR 1,400, 000 the return on capital employed will be 20%. During inflation with net profit calculated with replacement cost is OMR 180,000 and capital employed is OMR 22,00,000 the return on capital employed will be 8.2%. This situation expresses the following problem. a. Under historical cost accounting, the profits are overstated, and fixed assets are understated specially when there is increase in the price of the old fixed assets. b. Under historical cost accounting, return on capital employed which is very useful for the valuation of the business by its owners, creditors and management will not be correct and may lead to misleading decision c. Both the given statements are true in the given situation d. Both the given statements are false in the given situation
How much is controllable margin?
What can the weighted average contribution margin ratio be used for? To solve for a measure, at any level of sales volume, of the sensitivity of operating profit to changes in volume. Breakeven and profit planning for sales volume expressed in dollars (Y) rather than units (Q). To calculate an average per-unit contribution margin based on an assumed sales mix. To figure out the relative proportion in which a company’s products (or services) are sold. To determine the extent of fixed costs in an organization’s cost structure.
Compute the times interest ratio and use it to analyze liabilities. Show work
Remember: Gross profit = SP- CP Activity 1.2 enti Complete the following table: Table 1.2: Finding the cost price, the gross profit or the selling price No Cast price Gross prafit Selling price 1.2.1 R5 600 R8 700 1.2.2 R3 400 30% 1.2.3 R6 800 R12 700 1.2.4 R17 500 R35 000 The owner of an enterprise has to calculate both the gross and the net profit. A business has certain operating expenses thai must be deducied from the gross profit to get the net profit. Examples of operating expenses are: • Salaries Wages • Rent paid/rent expense • Advertisements • Stationery. The cost of advertising the business is one example of an operating expense. Gross profit minaş operating expenses equals net profit."
20. A company’s contribution approach income statement showed net income, variable production expenses, and fixed expenses of P4,000, P15,000, and P10,000, respectively. How much contribution margin did the company earn? P19,000 P14,000 P15,000 P29,000
a. What is the company's break-even point in unit sales? Break even point units b. Is it above or below the actual unit sales? OBelow O Above
Which of the following equations is true? Multiple Choice Dollar sales for company to break even (Traceable fixed expenses Common fixed expenses) + Overall contribution margin (CM) ratio Dollar sales for company to break even - (Traceable fixed expenses-Common fixed expenses) Overall contribution margin (CM) ratio Dollar sales for company to break even (Traceable variable expenses Traceable fixed expenses) Overall contribution margin (CM) ratio Dollar sales for company to break even (Traceable variable expenses-Common fixed expenses) Overall contribution margin (CM) ratio.
Suppose sales volume increase by the same percentage for Company X and Company Y. Use CVP analysis to explain which company will experience a larger percentage increase in profits? Company X - Dominated by fixed expenses; or Company Y - Dominated by variable expenses.
From the information provided in the table (i) Calculate EBIT, Fixed Cost, Variable cost and Profit after tax for Company A and S as per financial data given below. (ii) Comment on the Operating and Financial risk for both the firms. Give reasons for your answer. Particulars A S Variable Expenses as a percentage of sales 75% 50% Interest Expense in Amount Rs. 300 1000 Degree of Operating Leverage 6 2 Degree of Financial Leverage 4 2 Income Tax Rate 35% 35%