Answer? Alina's Catering has a monthly target operatingincome of $16,000. Variable expenses are 40%of sales and monthly fixed expenses$14,000. What is Alina's operating leveragefactor at the target level of operating income?are

Explanation of Operating Income:This is the profit a company generates from its core business…

Answered: Alina's Catering has a monthly target…

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter16: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 36P: Faldo Company produces a single product. The projected income statement for the coming year, based...

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Neeley Grocery has a monthly target operating income of $25,000. Variabe expenses are 20% of sales and monthly fixed expenses are $15,000. What is Neeley Grocery's operating leverage factor at the target level of operating income?
Western Repair Shop has a monthly target operating income of $50,000. Variable expenses are 55% of sales and monthly fixed expenses are $9,600. Requirements 1. Compute the monthly margin of safety in dollars if the shop achieves its income goal. 2. Express Western Repair Shop's margin of safety as a percentage of target sales. 3. What is Western Repair Shop's operating leverage factor at the target level of operating income? 4. Assume that the repair shop reaches its target. By what percentage will Western Repair Shop's operating income fall if sales volume declines by 16%? Requirement 1. Compute the monthly margin of safety in dollars if the shop achieves its income goal. Begin by identifying the formula to compute the margin of safety. Target sales in dollars Margin of safety in dollars The margin of safety is $. (Round interim calculations up to the nearest whole dollar and your final answer up to the nearest whole dollar.) Break-even sales in dollars =
Light Me Up Lamps has variable expenses of 30% of sales and monthly fixed expenses of $140,000. The monthly target operating income is $80,000. What is Light Me Up Lamps' operating leverage factor at the target level of operating income?
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A company requires $1305600 in sales to meet its operating income target. Its contribution margin is 30%, and fixed costs are $230400. What is the target operating income?
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Lin Corporation has a single product whose selling price is $120 and whose variable expense is $80 perunit. The company’s monthly fixed expense is $50,000.Required:1. Using the equation method, solve for the unit sales that are required to earn a target profit of$10,000.2. Using the formula method, solve for the unit sales that are required to earn a target profit of$15,000.
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Alina's Catering has a monthly target operating income of $16,000. Variable expenses are 40% of sales and monthly fixed expenses $14,000. What is Alina's operating leverage factor at the target level of operating income? are