(CMA, adapted) Zahner Corporation manufactures housewares products that are sold through a network of external sales agents. The agents are paid a commission of 20% of revenues. Zahner is considering replacing the sales agents with its own salespeople, who would be paid a commission of 10% of revenues and total salaries of $3,520,000. The income statement for the year ending December 31, 2017, under the two scenarios is shown here. Home Insert Page Layout Formulas Data Review View Zahner Corporation Income Statement For the Year Ended December, 2017 Using Sales Agents $35,200,000 3 Using Own Sales Force $35,200,000 5 Revenues 6 Cost of goods sold Variable $13,375,000 4,125,000 17,500,000 17,700,000 $13,375,000 4,125,000 17,500,000 Fixed 9 Gross margin 10 Marketing costs Commissions 17,700,000 $ 7,040,000 4,025.000 11,065,000 S 6,635.000 $ 3,520,000 7,545,000 11 11,065,000 S 6,635,000 Fixed costs 12 13 Operating income

(CMA, adapted) Zahner Corporation manufactures housewares products that are sold through a network of external sales agents. The agents are paid a commission of 20% of revenues. Zahner is considering replacing the sales agents with its own salespeople, who would be paid a commission of 10% of revenues and total salaries of $3,520,000. The income statement for the year ending December 31, 2017, under the two scenarios is shown here. Home Insert Page Layout Formulas Data Review View Zahner Corporation Income Statement For the Year Ended December, 2017 Using Sales Agents $35,200,000 3 Using Own Sales Force $35,200,000 5 Revenues 6 Cost of goods sold Variable $13,375,000 4,125,000 17,500,000 17,700,000 $13,375,000 4,125,000 17,500,000 Fixed 9 Gross margin 10 Marketing costs Commissions 17,700,000 $ 7,040,000 4,025.000 11,065,000 S 6,635.000 $ 3,520,000 7,545,000 11 11,065,000 S 6,635,000 Fixed costs 12 13 Operating income

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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