Scholastic Tours is trying to decide which one of two tours It will introduce. The costs and revenues associated with each alternative are listed below:Projected revenueVariable costsFixed costsProfitMultiple ChoiceWhat are the incremental (differential) costs of the Western Tour?$2,000.$3,000.Eastern Tour$16,0002,0003,000$11,000$6.000.Western Tour$18,0008,0003,000$7,000None of these choices are correct.

The incremental costs are the additional costs incurred compared to others. The net income is…

Answered: cholastic Tours is trying to decide…

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 company is considering two alternatives with the following costs: Alternative 1 Alternative 2Material costs$87,000 $87,000 Utilities costs$45,000 $44,100 Review costs$41,000 $44,100 Direct labor costs$51,000 $51,000 Identify the costs that are relevant and the costs that are not relevant, given the choice of alternatives. Calculate the differential cost between the alternatives.
REQUIRED Answer each of the following questions independently. As far as possible use the expanded contribution margin model to present your answers. Suppose an additional R300 000 is spent on advertising in order to increase the sales by 3 000 Calculate the number of pallets that need to be produced and sold to break even. Suppose the management team of Lomax Ltd is considering a R30 per pallet decrease in the selling price with the expectation that this would increase the sales volume by 10%. Is this a good idea? Motivate your answer with the relevant calculations. Determine the selling price per pallet that will enable Lomax Ltd to achieve an operating profit of R3 192 000. INFORMATION Lomax Ltd…
Special order, opportunity cost. Chade Corp. is considering a special order brought to it by a new client. If Chade determines the variable cost to be $9 per unit, and the contribution margin of the next best alternative of the facility to be $5 per unit, then if Chade has: Full capacity, the company will be profitable at $4 per unit. Excess capacity, the company will be profitable at $6 per unit. Full capacity, the selling price must be greater than $5 per unit. Excess capacity, the selling price must be greater than $9 per unit.
Assume that a company uses the absorption costing approach to cost-plus pricing. It is considering the introduction of a new product. To determine a selling price, the company has gathered the following information: Number of units to be produced and sold each year Unit product cost Estimated annual selling and administrative expenses Estimated investment required by the company Desired return on investment (ROI) What is the markup percentage on absorption cost required to achieve the desired ROI? 15,000 30 $ $81,900 $780,000 12%
XYZ company is studying the profitability of a change in operation and has gathered the following information. Anticipated Operation: Fixed Costs: $38,000, Selling Price: $16 Variable Cost $10 and Sales (Unit 9,000. Current Operation: Fixed Costs: $48,000, Selling Price: $22 Variable Cost: $12. and Sales (Units): 6.000. Should XYZ company make the change? Select one: O a. No. because sales will drop by 3.000 units. Ob. Yes, the company will be better off by $4,000. OC.No bacause the company will be worse off by 522.000. Odtis impossible to judge because additional information is needed. Oe No because the company will be worse off by $4. 000. Tfredrosts of 5300 000. he company s considering increasing the price of its units to S65 per unit, If the price
Do problem 4, a through h.
Please help me with show all calculation thanku
Given two alternatives, A and B; you have performed the cost analysis below. Your company has an MARR of 10%, which option should you choose? A B А-B Initial Cost $125,000 $105,000 $20,000 Annual $30,500 $27,000 $3,500 Benefits Annual $2,900 $4,000 ($1,100) Costs Salvage $0 $7,000 ($7,000) Value Life 7 7 7 IRR 12.2% 12.9% 7.8% A Neither Either could be chosen, they are equally as good
Company XYZ has $2,500,000 in fixed costs. It sells products at an average selling price of $50. Average variable costs amount to 60% of selling price. The marketing department proposes spending $500,000 on an advertising campaign which will result in increased volume of between 10,000 and 30,000 units. Determine: Breakeven volume before the proposed ad campaign Breakeven volume if ad campaign undertaken Minimum and maximum incremental profit if ad campaign undertaken Would you support the proposal? Why or why not? Unit volume to achieve an operating profit of $800,000 assuming the ad campaign is undertaken Operating income at unit volume of 200,000 units assuming ad campaign is undertaken Margin of safety assuming volume of 200,000 units is achieved and ad campaign undertaken Incremental operating income if an additional 1,000 units are sold
REQUIRED Answer each of the following questions independently. As far as possible use the expanded contribution margin model to present your answers. Calculate the total Contribution Margin and Operating Profit (Loss) if all 30 000 pallets are Sold. .calculate the margin of safety (as a percentage) for 2022 Use the contribution margin ratio to calculate the sales value required to achieve an operating profit of R6 000 000. Suppose an additional R300 000 is spent on advertising in order to increase the sales by 3 000 Calculate the number of pallets that need to be produced and sold to break even. Suppose the management team of…

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