Answered: Blossom Company had the following… | bartleby

FINANCIAL ACCOUNTING

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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Question

Blossom Company had the following operating data for the current year: sales, $460000; contribution margin, $100000; total fixed
costs (controllable), $50000; and average total operating assets, $250000. If management is able to improve its contribution margin by
$30000 and hold its fixed costs constant, what would Blossom's ROI be for the year?
O 20%.
O 32%.
O 40%.
O 17%.

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Diamond, Inc.'s most recent contribution margin income statement shows the following: Sales @ $10 per unit Less: Variable expenses Contribution margin Less: Fixed expenses Operating income (loss) $160,000 (120,000) $ 40,000 (50,000) $ (10,000) If Diamond, Inc's advertising costs increased by $5,000, by how much would sales have to increase for the company to achieve an operating income of $4,000? a. $56,000 Ob. $42,000 c. $76,000 Od. $18,000
Schister Systems uses the following data in its Cost-Volume-Profit analyses: Total Sales $380,000 Variable expenses $228,000 Contribution margin $152,000 Fixed expenses $116,000 Net operating income $36,000 What is total contribution margin if sales volume increases by 20%?
Skeeter Systems uses the following data in its Cost-Volume-Profit analyses: Sales Variable expenses Contribution margin Fixed expenses Net operating income O $80,000 What is total contribution margin if sales volume increases by 20%? O $158,400 O $200,000 Total $ 400,000 280,000 120,000 100,000 O $144,000 $ 20,000
Calculate the Operating Leverage for a business given the following data: Sales = $300,000.00 Variable Costs = 75% of Sales Operating Income = $40,000.00 Group of answer choices a. 0 b. 7.500 c. 1.875 d. 1.333
Hyms Division of ASOP’s Company’s operating results include: controllable margin, P200,000; sales P2,200,000; and operating assets, P800,000. The Hyms Division’s ROI is 25%. Management is considering a project with sales of P100,000, variable expenses of P60,000, fixed costs of P40,000; and an asset investment of P150,000. Should management accept this new project? a. No, since ROI will be lowered. b. Yes, since ROI will increase. c. Yes, since additional sales always mean more customers. d. No, since a loss will be incurred.
A company has three product lines, one of which reflects the following results: Sales Variable expenses Contribution margin Fixed expenses Net loss O decrease by $4000. O increase by $4000 decrease by $82000 $181000 99000 O increase by $48000 82000 130000 If this product line is eliminated, 60% of the fixed expenses can be eliminated and the other 40% will be allocated to other product lines. If management decides to eliminate this product line, the company's net income will $ (48000)
Using the following data, estimate the new Return on Investment if there is a 11% decrease in variable and fixed costs- with average operating assets as the base. Sales $2,436,021 Contribution margin 39% Controllable 361,596 fixed costs Average operating $5,885,455 assets Round to two decimal places. Be sure to enter the answer as a percentage but do not include the % sign.
Assume the following information: \table[[,Amount,Per Unit],[Sales,$300,000,$40

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