10%. Flat Tires Inc serves both retail and commercial clients. Annual financial information is asfollows:Sales RevenuesVariable CostsContribution MarginFixed CostsOperating ProfitCommercial$400,000150,000250,000Retail$200,000100,000100,000Total$600,000250,000350,000250,000$100,000a. What is Flat Tires contribution margin ratio?b. If Flat Tires management decides on a target operating profit of $200,000, what amounof sales revenues will be required if the sales mix is unchanged?

Contribution margin ratio is the ratio of contribution margin and the sales revenue. a. Contribution…

Answered: 10%. Flat Tires Inc serves both retail…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Remmel Corporation has provided the following contribution format income statement. Assume that the following information is within the relevant range. Sales (6,000 units) Variable expenses Contribution margin Fixed expenses Net operating income $ 300,000 240,000 60,000 59,000 $ 1,000 If sales increase to 6,020 units, the increase in net operating income would be closest to: Multiple Choice ○ $1,000.00 ○ $200.00 ○ $800.00 ○ $3.33
The company shows a contribution margin ratio of 25%. The company desires to earn a profit of $15,000 and has fixed costs of $25,000. Determine the sales revenue that would have to be generated in order to earn the desired profit. $340,000 None $240,000 $106,250 $160,000
The following information is available for Concord Corporation: Total fixed $150000 expenses == Total variable. 320000 expenses Sales Cost of goods sold $570000 370000 A CVP income statement would report O gross profit of $250000, contribution margin of $420000. Ogross profit of $200000. O contribution margin of $250000.
Contribution Margin Ratio a. Young Company budgets sales of $1,050,000, fixed costs of $80,300, and variable costs of $357,000. What is the contribution margin ratio for Young Company? D% b. If the contribution margin ratio for Martinez Company is 39%, sales were $627,000, and fixed costs were $190,730, what was the operating income?
Skeeter Systems uses the following data in its Cost-Volume-Profit analyses: Sales Variable expenses Contribution margin Fixed expenses Net operating income O $80,000 What is total contribution margin if sales volume increases by 20%? O $158,400 O $200,000 Total $ 400,000 280,000 120,000 100,000 O $144,000 $ 20,000
Operating Leverage Haywood Co. reports the following data: Sales $6,160,000 Variable costs (4,620,000) Contribution margin $1,540,000 Fixed costs (440,000) Operating income $1,100,000 Determine Haywood Co.’s operating leverage. Round your answer to one decimal place.
More-Power Company has projected sales of 75,000 regular sanders and 30,000 mini-sanders for next year. The projected income statement is as follows: Regular Sander Mini-Sander Total Sales $3,000,000 $1,800,000 $4,800,000 Less: Variable expenses 1,800,000 900,000 2,700,000 Contribution margin $1,200,000 $900,000 $2,100,000 Less: Direct fixed expenses 250,000 450,000 700,000 Product margin $950,000 $450,000 $1,400,000 Less: Common fixed expenses 600,000 Operating income $800,000 Required: 1. For each of the following possible sales mixes, calculate operating income: Regular Sander Mini-Sander a. 75,000 37,500 b. 60,000 60,000 c. 30,000 90,000 d. 30,000 60,000 Operating Income a. $_________ b. $______ c. $________ d. $_________ 2. Calculate the break-even units for each product for each of the preceding sales mixes. Round the number of break-even packages to two decimal…
Lawn Master Company, a manufacturer of riding lawn mowers, has a projected income for the coming year as follows: Sales Operating expenses: Variable expenses Fixed expenses Total expenses Operating profit $28,800,000 9,400,000 $48,000,000 1. Breakeven point in sales dollars 2. Required sales in dollars 3. Breakeven point in sales dollars 38,200,000 $ 9,800,000 Required: 1. Determine the breakeven point in sales dollars. 2. Determine the required sales in dollars to earn a before-tax profit of $13,000,000. (Do not round intermediate calculations. Round your answer to the nearest whole dollar amount.) 3. What is the breakeven point in sales dollars if the variable expenses increases by 14% ? (Do not round intermediate calculations. Round your final answer to the nearest whole dollar amount.)
CVP Analysis, *What IT?" AnalysisKevin Co. projected contribution-format income statement for the upcoming month is shownBelow Sales (500 units) $10000Variable expenses. 4000Contributions margin. 6000Fixed expenses. 1000Net operating income. 5000Required:a.) Compute the breakeven point in units.b) Compute the breakeven paint in dollars.c.) If the company wishes to earn a monthly target profit of $10,000, how many units must be sold each month?d.) Compute the company's margin of safety. State your answer in both dollar and percentage terms,e.) The company's manager thinks that adding a salaried sales staff member at a cost of 52,000 per month will increase sales by $4,000 per month. If he is correct, what will be the net dollar advantage or disadvantage of making this change?t.) Refer to the original data, the company's manager believes that a new production process will improve profitability. He plans to add new machinery that will cut variable expenses…
Contribution Margin Ratio a. Imelda Company budgets sales of $810,000, fixed costs of $62,000, and variable costs of $275,400. What is the contribution margin ratio for Imelda Company? (Enter your answer as a whole number.) % b. If the contribution margin ratio for Peppa Company is 62%, sales were $596,000, and fixed costs were $273,440, what was the income from operations?
Analyze each of the following transactions by showing its effects on the accounting equation—specifically, identify the accounts and amounts (including + or −) for each. January 1 Purchased equipment for $33,000 cash. Estimated useful life is six years and salvage value is $7,920. January 2 Paid $6,600 cash to install automated controls on equipment. This betterment did not impact useful life or salvage value. August 15 Paid $260 cash for minor repair costs to equipment.
Contribution Margin Ratio a. Imelda Company budgets sales of S1,800,000, fixed costs of $394,000, and variable costs of $1,116,000. What is the contribution margin ratio for Imelda Company? (Enter your answer as a whole number.) b. If the contribution margin ratio for Peppa Company is 42%, sales were $2,500,000, and fixed costs were $590,000, what was the income from operations? $_

SEE MORE QUESTIONS

Recommended textbooks for you

FINANCIAL ACCOUNTING

Accounting

ISBN:

9781259964947

Author:

Libby

Publisher:

MCG

Accounting

ISBN:

9781337272094

Author:

WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Publisher:

Cengage Learning,

Accounting Information Systems

Accounting

ISBN:

9781337619202

Author:

Hall, James A.

Publisher:

Cengage Learning,

FINANCIAL ACCOUNTING

Accounting

ISBN:

9781259964947

Author:

Libby

Publisher:

MCG

Accounting

ISBN:

9781337272094

Author:

WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Publisher:

Cengage Learning,

Accounting Information Systems

Accounting

ISBN:

9781337619202

Author:

Hall, James A.

Publisher:

Cengage Learning,

Horngren's Cost Accounting: A Managerial Emphasis…

Accounting

ISBN:

9780134475585

Author:

Srikant M. Datar, Madhav V. Rajan

Publisher:

PEARSON

Intermediate Accounting

Accounting

ISBN:

9781259722660

Author:

J. David Spiceland, Mark W. Nelson, Wayne M Thomas

Publisher:

McGraw-Hill Education

Financial and Managerial Accounting

Accounting

ISBN:

9781259726705

Author:

John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS