Darby Company, operating at full capacity, sold 116,100 units at a price of $123 per unit during the current year. Its income statement for the current year is as follows: Sales Cost of goods sold Gross profit Expenses: Selling expenses $3,526,000 Administrative expenses $3,526,000 Total expenses Income from operations $14,280,300 $7,052,000 $7,228,300 $7,052,000 $176,300 The division of costs between fixed and variable is as follows: Variable Fixed Cost of goods sold 70% 30% Selling expenses 75% 25% 50% Administrative expenses 50% Management is considering a plant expansion program that will permit an increase of $1,230,000 in yearly sales. The expansion will increase fixed costs by $123,000, but will not affect the relationship between sales and variable costs. Compute the break-even sales (units) for the current year.

Darby Company, operating at full capacity, sold 116,100 units at a price of $123 per unit during the current year. Its income statement for the current year is as follows: Sales Cost of goods sold Gross profit Expenses: Selling expenses $3,526,000 Administrative expenses $3,526,000 Total expenses Income from operations $14,280,300 $7,052,000 $7,228,300 $7,052,000 $176,300 The division of costs between fixed and variable is as follows: Variable Fixed Cost of goods sold 70% 30% Selling expenses 75% 25% 50% Administrative expenses 50% Management is considering a plant expansion program that will permit an increase of $1,230,000 in yearly sales. The expansion will increase fixed costs by $123,000, but will not affect the relationship between sales and variable costs. Compute the break-even sales (units) for the current year.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter5: The Income Statement And The Statement Of Cash Flows

Section: Chapter Questions

Problem 2MC: The following information is available for Cooke Company for the current year: The gross margin is...

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The following information is available for Cooke Company for the current year: The gross margin is 40% of net sales. What is the cost of goods available for sale? a. 5840,000 b. 960,000 c. 1,200,000 d. 1,220,000
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Johnson Corporation had beginning inventory of 20,000 at cost and 35,000 at retail. During the year, it made net purchases of 180,000 at cost and 322,000 at retail. Johnson nude sales of 300,000. Assuming a price index of 100 at the beginning of the year and 110 at the end of the year, compute Johnsons ending inventory at cost using the dollar-value LIFO retail method.
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