Cullumber Company is considering two alternatives. Alternative A will have revenues of $147,300 and costs of $101,600. AlternativeB will have revenues of $185,100 and costs of $122,800. Compare Alternative A to Alternative B showing incremental revenues,costs, and net income. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)RevenuesAlternativeACostsNet Income$is better than$SA$AlternativeB$Net IncomeIncrease (Decrease)

Step 1: Alternative A:- Revenues: $147,300- Costs: $101,600- Net Income: $147,300 - $101,600 =…

Answered: Cullumber Company is considering two…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

If accounting profit is $400,000 greater than economic profit, what do implicit costs equal?
Product A has revenue of $195,600, variable cost of goods sold of $114,200, variable selling expenses of $33,900, and fixed costs of $59,200, creating a loss from operations of $11,700. Prepare a differential analysis as of May 9, to determine whether Product A should be continued (Alternative 1) or discontinued (Alternative 2), assuming fixed costs are unaffected by the decision. If an amount is zero, enter "O". For those boxes in which you must enter subtracted or negative numbers use a minus sign Differential Analysis Continue Product A (Alt. 1) or Discontinue Product A (Alt. 2) May 9 Differential Effect Continue Product Discontinue Product on Income A (Alternative 1) A (Alternative 2) (Alternative 2) 195,600 -195,600 Revenues Costs: -114,200 X 114,200 X Variable cost of goods sold 33,900 X -33,900 X Variable selling expenses 59,200 X X 59,200 Fixed costs 11,700 -59,200 -47,500 Income (Loss)
Target profit is added to what other financial statement line item, or element, to determine the numerator in the overall target contribution margin (CM) calculation in break-even analysis? Variable costs Fixed costs Net income after taxes Operating profit
Garrett Company provided the following information: Common fixed cost totaled $46,000. Garrett allocates common fixed cost to Product 1and Product 2 on the basis of sales. If Product 2 is dropped, which of the following is true?a. Sales will increase by $300,000.b. Overall operating income will increase by $2,600.c. Overall operating income will decrease by $25,000.d. Overall operating income will not change.e. Common fixed cost will decrease by $27,600.
Your answer is incorrect. Divide the estimated average annual income by the average investment. Investment cost plus residual value, divided by two, equals average investment. Can you please redo it? Thanks
Product B has revenue of $39,500, variable cost of goods sold of $25,500, variableselling expenses of $16,500, and fixed costs of $15,000, creating a loss from operationsof $17,500. Prepare and show in solution a differential analysis as of May 9 todetermine if Product B should be continued (Alternative 1) or discontinued (Alternative 2), assuming fixed costs are unaffected by the decision.
using the price p=20 - .05x, use the Revenue function to find the marginal Revenue function R'(x), Find a. R'(100)= b. R'(175)= c. R'(250)= The marginal Revenue R'(x) approximates how the revenue will change on the sale of the next item. a. Given R(100) = 642 and R'(100)= 18 then R(101) ≈ b. Given R(400) = 16,250 and R'(400)= -10 then R(401) ≈ c. Given R(1000) = 3500 and R'(1000) = 3 then R(1001) ≈
How much would be the net effect on the total segment profit if product B is dropped and discontinued? Assume that by dropping product B, product A would increase A's sales by 80%. How much would be the net effect on the total segment profit? Assume that by dropping product B, product A would decrease A's sales by 20%. Moreover, 30,000 of common costs allocated are avoidable. How much would be the net effect on the total segment profit?

Recommended textbooks for you

FINANCIAL ACCOUNTING

Accounting

ISBN:

9781259964947

Author:

Libby

Publisher:

MCG

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,

FINANCIAL ACCOUNTING

Accounting

ISBN:

9781259964947

Author:

Libby

Publisher:

MCG

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

SEE MORE TEXTBOOKS