AC75067 company produces and sells a product with the following characteristics: Per Unit Selling price Variable expenses Contribution margin 2$ 246 57 $4 189 The AC75067 company is currently selling 8,600 units per month. Fixed expenses are $874,000 per month. The sales manager would like to introduce commissions as an incentive for the sales staff. The sales manager has proposed a commission of $31 per unit. In exchange, the sales staff would accept a decrease in their salaries of $69,000 per month. (This is the company's savings for the entire sales staff.) The manager predicts that introducing this sales incentive would increase monthly unit sales by 20%. What would be the overall effect on AC75067 company's monthly net operating income of this change? Multiple Choice increase of $91,528 < Prev 2 of 12 Next > MAR otv 56 17,650 14

AC75067 company produces and sells a product with the following characteristics: Per Unit Selling price Variable expenses Contribution margin 2$ 246 57 $4 189 The AC75067 company is currently selling 8,600 units per month. Fixed expenses are $874,000 per month. The sales manager would like to introduce commissions as an incentive for the sales staff. The sales manager has proposed a commission of $31 per unit. In exchange, the sales staff would accept a decrease in their salaries of $69,000 per month. (This is the company's savings for the entire sales staff.) The manager predicts that introducing this sales incentive would increase monthly unit sales by 20%. What would be the overall effect on AC75067 company's monthly net operating income of this change? Multiple Choice increase of $91,528 < Prev 2 of 12 Next > MAR otv 56 17,650 14

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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Houpe Corporation produces and sells a single product. Data concerning that product appear below: Per Unit Percent of Sales Selling price $ 140 100% Variable expenses 42 30% Contribution margin $ 98 70% Fixed expenses are $490,000 per month. The company is currently selling 6,000 units per month. The marketing manager would like to introduce sales commissions as an incentive for the sales staff. The marketing manager has proposed a commission of $11 per unit. In exchange, the sales staff would accept a decrease in their salaries of $58,000 per month. (This is the company's savings for the entire sales staff.) The marketing manager predicts that introducing this sales incentive would increase monthly sales by 100 units. What should be the overall effect on the company's monthly net operating income of this change?
Mauro Products sells a woven basket for $10 per unit. Its variable expense is $8 per unit and the company's monthly fixed expense is $2,600. Required: 1. Calculate the company's break-even point in unit sales. 2. Calculate the company's break-even point in dollar sales. Note: Do not round intermediate calculations. 3. If the company's fixed expenses increase by $600, what would become the new break-even point in unit sales? In dollar sales? Note: Do not round intermediate calculations. 1. Break-even point in unit sales 2. Break-even point in dollar sales 3. Break-even point in unit sales 3. Break-even point in dollar sales baskets baskets
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Sinclair Company's product has a selling price of £25 per unit. Last year the company reported a profit of £20,000 and variable expenses totalling £180,000. The product has a 40% contribution margin ratio. Because of competition, Sinclair Company will be forced in the current year to reduce its selling price by £2.00 per unit. How many units must be sold in the current year to earn the same profit as was earned last year? Select one: O A. 15,000 units O B. 12,000 units O C. 16,500 units O D. 12,960 units
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Need step by step explanation.Mauro Products distributes a single product, a woven basket whose selling price is $14 per unit and whose variable expense is $12 per unit. The company’s monthly fixed expense is $4,600. Required: Calculate the company’s break-even point in unit sales. Calculate the company’s break-even point in dollar sales. (Do not round intermediate calculations.) If the company's fixed expenses increase by $600, what would become the new break-even point in unit sales? In dollar sales? (Do not round intermediate calculations.)