5. what is the break even point in dollar sales? 6. what is the break even point in unit sales? 7.if the variable cost per unit increases by $1, spending on advertising increases by$1400 andunit sales increase by 180 units, what would be the net operating income? Required information[The following information applies to the questions displayed below.]Oslo Company prepared the following contribution format income statement based on a sales volume of 1,000 units (therelevant range of production is 500 units to 1,500 units):SalesVariable expensesContribution marginFixed expensesNet operating income$ 50,00027,50022,50014,850$ 7,650

Variable Costs: Variable costs is the cost which tends to increase or decrease depending on the…

Answered: 5. what is the break even point in…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Part 2. Bhiner Company prepared the following contribution format income statement based on a sales volume of 1,000 units (the relevant range of production is 500 units to 1,500 units). Sales $25,000 Variable expenses 10.000 ontribution margin 15,000 +Fixed expenses 8.000 Net operating income $ 7.000 Required: (Answer each question independently and always refer to the original data unless instructed otherwise.) (Show all work/calculations. No credit will be given without
a.Explain why contribution margin per unit becomes profit per unit above the break-even point b. If the contribution margin per unit is $7 and the break-even point is 10,000 units, how much profit will a firm make if 15,000 units are sold? c.What is the variable cost ratio? The contribution margin ratio? How are the two ratios related?
1. What is the present yearly net operating income or loss? 2. What is the present break-even point in unit sales and in dollar sales? 3. Assuming that the marketing studies are correct, what is the maximum annual profit that the company can earn? At how many units and at what selling price per unit would the company generate this profit?
Imagine that you could increase the price for a product that has a profit margin of 8% on its price. If you could increase the price by 1% AND simultaneously keep the sales volume (in unit terms) at the same level as before the price increase, calculate the impact of this price increase on the profit margin. (For this question, assume there are no fixed costs. You just need to calculate the PERCENTAGE CHANGE in profit margin)
8. A company has return on sales of 20%, income of $50,000, selling price of $10, and a contribution margin of 40%.A. What are fixed costs?B. What are variable costs per units?C. What are sales in units?D. What are sales in dollars? *
A company has return on sales of 20%, income of $50,000, selling price of $10, and a contribution margin of 40% . A. What are fixed costs? Why? How? B. What are variable costs per units? Why? How? C. What are sales in units? D. What are sales in dollars? Why? How?
P Company has provided the following data: Sales Price per unit: $50 Variable Cost per unit: $30 Fixed Cost: $135,000 Expected Sales: 20,000 units a) What is the breakeven point in sales dollars? b) What is the current margin of safety? c) If the company wants to have net income of $70,000, how many units must they sell?
2. Given the following information: The ratio of variable cost per unit divided by selling price per unit equals 0.25 Fixed Costs Amount to $50,000 a. What is the Break-even point b. What effect would a 6% decrease in selling price have on the break even point from part a?
compute for the following items: g. If breakeven sales in units will increase by 10,000 units, how much will be the increase/decrease in profits? h. If breakeven sales in units will decrease by 4,000 units, how much will be the increase/decrease in profits? i. If the firm wants to increase its current profits by P 60,000. How much sales revenue does it have to make?
Given that the total cost, C, is related to sales volume, x, by the equation y=1000+0.2x, say true or false for the following and proof it. (a) The cost-sales line rises $2 for each increase of $10 in sales volume. (b) The slope of the line is interpreted as variable cost
1.) what is the break-even in dollar sales? 2.) what is the margin of safety percentage? 3.) what is the degree of operating leverage ? (Round your answer to 2 decimal places.) 4.) using the degree of operating leverage and without changing anything, calculate the percentage change in net operating income if unit sales increase by 20% ?
I have the following additional questions: 1) Calculate the breakeven point in dollars under the current scenario 2) Calculate the number of units to be sold if the company desires a target profit of $225,000. 3) Calculate the sales dollars if the company desires a target profit of $225,000.

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5. what is the break even point in dollar sales? 6. what is the break even point in unit sales? 7. if the variable cost per unit increases by $1, spending on advertising increases by$1400 and unit sales increase by 180 units, what would be the net operating income?