A firm operated at 80% of capacity for the past year, during which fixed costs were $191,000, variable costs were 66% of sales, and sales were $908,000.Operating profit wasOa. $599,280Ob. $94,176Oc. $308,720Od. $117,720

Answered: A firm operated at 80% of capacity for…

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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A firm operated at 80% of capacity for the past year, during which fixed costs were $209,000, variable costs were 68% of sales, and sales were $1,080,000. Operating profit was Oa. $734,400 Ob. $109,280 Oc. $345,600 Od. $136,600
4
BR Company has a contribution margin of 20%. Sales are $403,000, net operating income is $80,600, and average operating assets are $128,000. What is the company's return on investment (ROI)? Multiple Choice 63.0% 0.3% 20.0% 3.2%
A firm operated at 80% of capacity for the past year, during which fixed costs were $201,000, variable costs were 61% of sales, and sales were $919,000. Operating profit was a.$358,410 b.$157,410 c.$125,928 d.$560,590
A firm operated at 80% of capacity for the past year, during which fixed costs were $190,000, variable costs were 65% of sales, and sales were $976,000. Operating profit was a. $151,600 Ob. $634,400 OC. $121,280 d. $341,600 ?
Westerville Company reported the following results from last year’s operations: Sales $ 1,500,000 Variable expenses 500,000 Contribution margin 1,000,000 Fixed expenses 700,000 Net operating income $ 300,000 Average operating assets $ 1,000,000 At the beginning of this year, the company has a $200,000 investment opportunity with the following cost and revenue characteristics: Sales $ 300,000 Contribution margin ratio 60 % of sales Fixed expenses $ 132,000 The company’s minimum required rate of return is 10%. Required: 1. What is last year’s margin?
From the following information, compute percent change in operating income for the current year. Sales for the previous year $210,000 Contribution margin 181,000 Fixed costs 125,000 Operating income 36,000 Assume that sales for the current year increased by 17%. a.86% b.92% c.74% d.96%
Calculating Residual Income East Mullett Manufacturing earned operating income last year as shown in the following income statement: Sales $3,750,000 Cost of goods sold 2,250,000 Gross margin $1,500,000 Selling and administrative expense 1,200,000 Operating income $ 300,000 Less: Income taxes (@ 40%) 120,000 Net income $ 180,000 At the beginning of the year, the value of operating assets was $1,600,000. At the end of the year, the value of operating assets was $1,400,000. East Mullett requires a minimum rate of return of 5%. What is the residual income?
Westerville Company reported the following results from last year’s operations: Sales $ 1,500,000 Variable expenses 690,000 Contribution margin 810,000 Fixed expenses 435,000 Net operating income $ 375,000 Average operating assets $ 1,250,000 At the beginning of this year, the company has a $350,000 investment opportunity with the following cost and revenue characteristics: Sales $ 420,000 Contribution margin ratio 70 % of sales Fixed expenses $ 252,000 The company’s minimum required rate of return is 10%. 1. Assume that the contribution margin ratio of the investment opportunity was 65% instead of 70%. If Westerville’s Chief Executive Officer will earn a bonus only if her residual income from this year exceeds her residual income from last year, would she pursue the investment opportunity? yes or no 2. Would the owners of the company want her to pursue the investment opportunity?
A firm operated at 90% of capacity for the past year, during which fixed costs were $420,000, variable costs were 40% of sales, and sales were $1,000,000. Operating profit was: Answer a. $980,000 b. $420,000 c. $1,080,000 d. $180,000
Westerville Company reported the following results from last year’s operations: Sales $ 1,800,000 Variable expenses 740,000 Contribution margin 1,060,000 Fixed expenses 700,000 Net operating income $ 360,000 Average operating assets $ 1,200,000 At the beginning of this year, the company has a $400,000 investment opportunity with the following cost and revenue characteristics: Sales $ 600,000 Contribution margin ratio 60 % of sales Fixed expenses $ 288,000 The company’s minimum required rate of return is 10%. 2. What is last year’s turnover? (Round your answer to 1 decimal place.) 3. What is last year’s return on investment (ROI)? (Round your intermediate calculations to 1 decimal place.) 4. What is the margin related to this year’s investment opportunity? 5. What is the turnover related to this year’s investment opportunity? (Round your answer to 1 decimal place.)
Bryce Co. sales are $897,000, variable costs are $468,500, and operating income is $276,000. The contribution margin ratio is Oa. $2.2% Ob. 57.4% Oc. 47.8% Od. 43.5%

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A firm operated at 80% of capacity for the past year, during which fixed costs were $191,000, variable costs were 66% of sales, and sales were $908,000. Operating profit was Oa. $599,280 Ob. $94,176 Oc. $308,720 Od. $117,720