I need answer of this question accounting Assume that the amounts of the company's total variable expenses and total fixedexpenses were reversed. In other words, assume that the total variable expensesare $6,952 and the total fixed expenses are $12,400. Given this scenario, andassuming that total sales remain the same, calculate the degree of operatingleverage. Using the calculated degree of operating leverage, what is the estimatedpercentage increase in net operating income of a 4% increase in sales? (Do notround intermediate calculations. Round your answer to 2 decimal places.)Oslo Company prepared the following contribution format income statementbased on a sales volume of 1,000 units (the relevant range of production is 500units to 1,500 units):Sales $ 26,000Variable expenses 14,000Contribution margin 12,000Fixed expenses 7,800Net operating income $ 4,200

Step 1: Define Degree Of Operating LeverageThe degree of operating leverage is a financial ratio…

Answered: Assume that the amounts of the…

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter7: Variable Costing For Management analysis

Section: Chapter Questions

Problem 16E

See similar textbooks

Similar questions

N. Assume that the amounts of the company's total variable expenses and total fixed expenses were reversed. In other words, assume that the total variable expenses are $8,000 and the total fixed expenses are $10,000. Under this scenario and assuming that total sales remain the same , what is the degree of operating leverage? O. Using the degree of operating leverage that you computed in the previous question , what is the estimated percent increase in net operating income of a 10% increase in sales ?
Which of the following is true regarding the contribution margin ratio of asingle product company? a. As fixed expenses decrease, the contribution margin ratio increases b. The contribution margin ratio increases as the number of units sold increase c. The contribution margin ratio multiplied by the variable expense per unit equals thecontribution margin per unit d. If sales increase, the peso increase in net operating income can be computed bymultiplying the contribution margin ratio by the peso increase in sales
Company XYZ is currently making sales of $200,000. At this level, the variable expenses were $160,000. Assume that company XYZ expects sales to increase to $450,000 in the coming period with no change is expected to fixed expenses. How much is the expected change in profit? a. Cannot be determined O b. Increase by $160,000 O c. Increase by $10,000 d. Increase by $50,000 е. Increase by 40,000
Calculate the residual income with the following data: Controllable margin $202,596 Minimum Rate of Return 11% Average Operating Assets $3,092,235 Round to the nearest whole dollar, no decimal places. Note: Controllable margin is the same as net income for a segment with control over the costs. Minimum rate of return is the same as the cost of capital.
Income statements for two different companies in the same industry are as follows: Required:1. Compute the degree of operating leverage for each company.2. CONCEPTUAL CONNECTION Compute the break-even point in dollars for eachcompany. Explain why the break-even point for Macduff is higher.3. CONCEPTUAL CONNECTION Suppose that both companies experience a 30% increasein revenues. Compute the percentage change in profits for each company. Explain why thepercentage increase in Macduff ’s profits is so much larger than that of Duncan.
AutoSave OFF 096DCEP… CB Draw Page Layout Home Insert X [ ✓ Paste B35 A Arial A 1 Chapter 5: Applying Excel 2 3 Data 4 Unit sales 5 Selling price per unit 6 Variable expenses per unit 7 Fixed expenses BIU - fx =B31/833 49 50 30 Variable expenses varable 31 Contribution margin 32 Fixed expenses 33 Net operating income 11 12 Compute the CM ratio and variable expense ratio 13 Selling price per unit 14 Variable expenses per unit 15 Contribution margin per unit 16 17 CM ratio 18 Variable expense ratio 19 20 Compute the break-even point 21 Break-even in unit sales 22 Break-even in dollar sales 23 24 Compute the margin of safety 25 Margin of safety in dollars 26 Margin of safety percentage 27 28 Compute the degree of operating leverage 29 Sales 34 35 Degree of operating leverage 36 37 38 39 40 41 42 43 44 45 46 47 48 Ready T 8 9 Enter a formula into each of the cells marked with a ? below 10 Review Problem: CVP Relationships Chapter 5 Form V esc ✓ 10 1 + LO Accessibility: Good to go @ 2…
Which of the following is true regarding the contribution margin ratio of a single product company? As fixed expenses decrease, the contribution margin ratio increases. The contribution margin ratio multiplied by the variable expense per unit equals the contribution margin per unit. The contribution margin ratio increases as the number of units sold increases. If sales increase, the dollar increase in net operating income can be computed by multiplying the contribution margin ratio by the dollar increase in sales.
Suppose sales volume increase by the same percentage for Company X and Company Y. Use CVP analysis to explain which company will experience a larger percentage increase in profits? Company X - Dominated by fixed expenses; or Company Y - Dominated by variable expenses.
Margin, Turnover, Return on Investment Pelak Company had sales of $4,887,000, expenses of $4,443,000, and average operating assets of $4,840,000. Required: If required, round your answers to nearest whole value. 1. Compute the operating income. 2. Compute the margin (as a percent) and turnover ratio. If required, round your answers to one decimal place. Margin % Turnover 3. Compute the ROI as a percent. Use the part 2 final answers in these calculations and round the final answer to two decimal places. %
Provide this question solution general accounting
the question is in the attached pictures
f net profit of the firm is OMR 280,000 and capital employed is OMR 1,400, 000 the return on capital employed will be 20%. During inflation with net profit calculated with replacement cost is OMR 180,000 and capital employed is OMR 22,00,000 the return on capital employed will be 8.2%. This situation expresses the following problem. a. Under historical cost accounting, the profits are overstated, and fixed assets are understated specially when there is increase in the price of the old fixed assets. b. Under historical cost accounting, return on capital employed which is very useful for the valuation of the business by its owners, creditors and management will not be correct and may lead to misleading decision c. Both the given statements are true in the given situation d. Both the given statements are false in the given situation

SEE MORE QUESTIONS

Recommended textbooks for you

Managerial Accounting

Accounting

ISBN:

9781337912020

Author:

Carl Warren, Ph.d. Cma William B. Tayler

Publisher:

South-Western College Pub

Cornerstones of Cost Management (Cornerstones Ser…

Accounting

ISBN:

9781305970663

Author:

Don R. Hansen, Maryanne M. Mowen

Publisher:

Cengage Learning

Managerial Accounting

Accounting

ISBN:

9781337912020

Author:

Carl Warren, Ph.d. Cma William B. Tayler

Publisher:

South-Western College Pub

Cornerstones of Cost Management (Cornerstones Ser…

Accounting

ISBN:

9781305970663

Author:

Don R. Hansen, Maryanne M. Mowen

Publisher:

Cengage Learning

SEE MORE TEXTBOOKS