Espresso Express operates a number of espresso coffee stands In busy suburban malls. The fixed weekly ex $1.500 and the varlable cost per cup of coffee served is $0.67 Required: 1. Fill in the following table with your estimates of the company's total cost and average cost per cup of coffe activity. 2. Does the average cost per cup of coffee served increase, decrease, or remain the same as the number of week increases? Complete this question by entering your answers in the tabs below.

Espresso Express operates a number of espresso coffee stands In busy suburban malls. The fixed weekly ex $1.500 and the varlable cost per cup of coffee served is $0.67 Required: 1. Fill in the following table with your estimates of the company's total cost and average cost per cup of coffe activity. 2. Does the average cost per cup of coffee served increase, decrease, or remain the same as the number of week increases? Complete this question by entering your answers in the tabs below.

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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Liberty Coffee sells three small coffees for every large coffee. A small coffee sells for $3.00, with a variable expense of $1.50. A large coffee sells for $5.00, with a variable expense of $2.50.Requirements1. Determine the coffee shop’s monthly breakeven point in the numbers of small coffees and large coffees. Prove your answer by preparing a summary contribution margin income statement at the breakeven level of sales. Show only two categories of expenses: variable and fixed.2. Compute the coffee shop’s margin of safety in dollars.3. Use the coffee shop’s operating leverage factor (using the July contribution margin income statement) to determine its new operating income if sales volume increases 12%. Prove your results using the contribution margin income statement format. Assume that sales mix remains unchanged.
The following information applies to the questions displayed below.] The Fashion Shoe Company operates a chain of women’s shoe shops that carry many styles of shoes that are all sold at the same price. Sales personnel in the shops are paid a sales commission on each pair of shoes sold plus a small base salary. The following data pertains to Shop 48 and is typical of the company’s many outlets: Per Pair of Shoes Selling price $ 25.00 Variable expenses: Invoice cost $ 11.50 Sales commission 3.50 Total variable expenses $ 15.00 Annual Fixed expenses: Advertising $ 32,000 Rent 17,000 Salaries 110,000 Total fixed expenses $ 159,000 6. Refer to the original data. The company is considering eliminating sales commissions entirely in its shops and increasing fixed salaries by $35,400 annually. If this change is made, what will be Shop 48's new break-even point in unit sales and dollar sales? (Do not round intermediate calculations.)
Jenny's Pottery Store is a small retail company that has the following information pertaining to current year operations. Sales (2,500 fruit bowls) Cost of goods sold Manager's salary allocation Rent cost allocation Advertising Commissions (10% of sales) What are the estimated total costs if Jenny's expects to sell 3,000 units next year? A) $86,700 B) $98,700 C) $76,700 D) $88,700 $100,000 45,000 20,000 700 2,000 10,000 E) $84,240
Home Entertainment is a small, family-owned business that purchases LCD televisions from a reputable manufacturer and sells them at the retail level. The televisions sell, on average, for $2,060 each. The average cost of a television from the manufacturer is $1,330. Home Entertainment has always kept careful accounting records, and the costs that it incurs in a typical month are as follows: Costs Cost Formula Selling: Advertising $ 1,090 per month Delivery of televisions $ 50 per television sold Sales salaries and commissions $ 3,040 per month, plus 5% of sales Utilities $ 404 per month Depreciation of sales facilities $ 3,160 per month Administrative: Executive salaries $ 11,500 per month Depreciation of office equipment $ 805 per month Clerical $ 1,860 per month, plus $49 per television sold Insurance $ 720 per month During April, the company sold and delivered 219…
Widget Co. produces widgets for customers. The company has provided the following financial information for the past year. Each scenario below is separate. Product Selling price per unit Sales Quantity Variable cost per unit Fixed costs Widgets $9.00 528,000 $2.00 $67,000 Do not enter dollar signs or commas in the input boxes. Round breakeven units up to the nearest whole number. Round breakeven sales to the nearest whole number. a) Calculate break-even units and break-even sales. Breakeven units = Breakeven sales = $ b) Suppose the company would like to generate an operating profit of $5,000. Determine the revenue that is needed to obtain this target, and calculate the number of units that need to be produced to meet this goal. Breakeven units = Breakeven sales = $ c) Suppose the company decides to lower the selling price from $9.00 per unit to $8.00 per unit. Calculate break-even units and break- even sales. Breakeven units = Breakeven sales = $ d) Suppose that fixed costs drop to…
D8.
Last month Annie's Homemade sold 5,000 servings of ice cream for $5.00 each. Its variable cost is $1.25 per serving and its total fixed costs were $11,000. Required: 1. What was last month's margin of safety? 2. What was last month's margin of safety percentage? Complete this question by entering your answers in the tabs below. Required 1 Required 2 What was last month's margin of safety? Margin of safety
Espresso Express operates a number of espresso coffee stands in busy suburban malls. The fixed weekly expense of a coffee stand is $600 and the variable cost per cup of coffee served is $0.47. Required: 1. Fill in the following table with your estimates of the company's total cost and average cost per cup of coffee at the indicated levels of activity. 2. Does the average cost per cup of coffee served increase, decrease, or remain the same as the number of cups of coffee served in a week increases? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Fill in the following table with your estimates of the company's total cost and average cost per cup of coffee at the indicated levels of activity. (Round the "Average cost per cup of coffee served" to 3 decimal places.) Fixed cost Variable cost Total cost Average cost per cup of coffee served 700 Cups of Coffee $ 0 $ 0
How do I complete the table on question 2.2 ?
Russell Preston delivers parts for several local auto parts stores. He charges clients $0.75 per mile driven. Russell has determined that if he drives 3,480 miles in a month, his average operating cost is $0.55 per mile. If he drives 4,640 miles in a month, his average operating cost is $0.50 per mile. Russell has used the high-low method to determine that his monthly cost equation is total cost = $696 + $0.35 per mile. Required: 1. Determine how many miles Russell needs to drive to break even. 2. Assume Russell drove 2,040 miles last month. Without making any additional calculations, determine whether he earned a profit or a loss last month. 3. Determine how many miles Russell must drive to earn $1,000 in profit. 4. a. Prepare a contribution margin income statement assuming Russell drove 2,040 miles last month. b. Use the information provided in Req 4a to calculate Russell's degree of operating leverage. Complete this question by entering your answers in the tabs below. Req 1 Req 2…