company planned normal operation level (10,000 h) sales revenues andcosts for the 3rd quarter of 2023 are as follows (euros): Total | Product 1 | Product 2 Sales Revenues | 400,000 | 160,000 | 240,000 Direct Materials | 110,000 | 40,000 | 70,000 Direct Labor | 80,000 | 30, 000 | 50,000 Variable Overheads | 120, 000 | 48,000 | 72, 000 Fixed Direct Costs | 3, 500 | 2, 000 | 1,500 Contribution Margin | 86,500 | 40,000 | 46, 500 Fixed Overheads: Depreciation | 25,000 Other | 30,000 Profit Before Taxes | 31,500 a) What are the break- even points for the products and the company? c) How large must the sales be in the third quarter of 2023, so that the profit after taxes would be 50 000 euros/year, if the tax rate is 20 % and the company's contribution margin % is 25 %.
company planned normal operation level (10,000 h) sales revenues andcosts for the 3rd quarter of 2023 are as follows (euros): Total | Product 1 | Product 2 Sales Revenues | 400,000 | 160,000 | 240,000 Direct Materials | 110,000 | 40,000 | 70,000 Direct Labor | 80,000 | 30, 000 | 50,000 Variable Overheads | 120, 000 | 48,000 | 72, 000 Fixed Direct Costs | 3, 500 | 2, 000 | 1,500 Contribution Margin | 86,500 | 40,000 | 46, 500 Fixed Overheads: Depreciation | 25,000 Other | 30,000 Profit Before Taxes | 31,500 a) What are the break- even points for the products and the company? c) How large must the sales be in the third quarter of 2023, so that the profit after taxes would be 50 000 euros/year, if the tax rate is 20 % and the company's contribution margin % is 25 %.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Concept explainers
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
Topic Video
Question
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 3 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education