EX 7-24 (Algo) Pizza Delivery Business; Basic CVP Analysis (LO 7-1, 7-2, 7-4)College Pizza delivers pizzas to the dormitories and apartments near a major state university. The company's annual fixed expensesare $63,000. The sales price of a pizza is $20, and it costs the company $10 to make and deliver each pizza. (In the followingrequirements, ignore income taxes.)Required:1. Using the contribution-margin approach, compute the company's break-even point in units (pizzas).2. What is the contribution-margin ratio?Note: Enter your answer as a decimal.3. Compute the break-even sales revenue. Use the contribution-margin ratio in your calculation.4. How many pizzas must the company sell to earn a target profit of $69,000? Use the equation method.1. Break-even point2. Contribution-margin ratio3. Break-even point sales dollars4. Number of pizzaspizzas

Break-even point: It implies thlevel of production activity at which the business will neither earn…

Answered: EX 7-24 (Algo) Pizza Delivery Business;…

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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bed Cruse Cleaning offers residential and small office cleaning services. An average cleaning service has the following price and costs. Sales price Variable costs Fixed costs $127.00 per service 89.00 per service 119,548 per year Cruse Cleaning is subject to an income tax rate of 22 percent. Required: a. How many cleaning services must Cruse Cleaning sell in a year to break even? ook b. How many cleaning services must Cruse Cleaning sell in a year to earn an annual operating profit of $32,604 after taxes? a Required sales in a year to break even int rences b. Required sales in a year to earn an annual operating profit of $32,604 after taxes: cleaning services cleaning services
CVP; multiproduct Mel's Accessories sells wallets and money clips. Historically, the firm's sales have averaged three wallets for every money clip. Each wallet has an $8 contribution margin, and each money clip has a $6 contribution margin. Mel's incurs fixed cost in the amount of $180,000. The selling prices of wallets and money clips, respectively, are $30 and $15. The corporate-wide tax rate is 40 percent. a. How much revenue is needed to break even? $ 756,000 x How many wallets and money clips does this represent? 648,000 x wallets 108,000 x money clips b. How much revenue is needed to earn a pre-tax profit of $150,000? Note: Do not round until you determine the number of units of each product; round number of units to the next highest whole unit in your calculations. $ 0 c. How much revenue is needed to earn an after-tax profit of $150,000? Note: Do not round until you determine the number of units of each product; round number of units to the next highest whole unit in your…
am. 129.
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Required Information Problem 12-47 (LO 12-3) (Algo) [The following information applies to the questions displayed below.] LaMont works for a company in downtown Chicago. The company encourages employees to use public transportation (to save the environment) by providing them with transit passes at a cost of $278 per month. Problem 12-47 Part a (Algo) a. If LaMont receives one pass (worth $278) each month, how much of this benefit must he include in his gross income each year? Transit pass benefit to be included in gross income
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solve questions a and b
3-27 CVP analysis, income taxes. The Home Style Eats has two restaurants that are open 24 hours aday. Fixed costs for the two restaurants together total $430,500 per year. Service varies from a cup of coffeeto full meals. The average sales check per customer is $8.75. The average cost of food and other variablecosts for each customer is $3.50. The income tax rate is 36%. Target net income is $117,600.1. Compute the revenues needed to earn the target net income.2. How many customers are needed to break even? To earn net income of $117,600?3. Compute net income if the number of customers is 170,000.
21
Nik.1
A dairy farmer has found that it costs $1.84 to produce each gallon of milk, and the daily fixed cost to maintain production is $345. If the farmer charges $3.29 per gallon of milk when he sells it to a large grocery store chain, how many gallons of milk does the farmer need to produce and sell to make a daily profit of $479? (Round your answer to the nearest whole number of gallons.) The farmer needs to produce and sell gallons of milk to make a daily profit of $479.
lil pront before tax? Problem 2 The manager of the Spartan Land Restaurant is developing the operating budget for next year using the following financial information from the current year: Item Food revenue Beverage revenue Food cost Current Year's Amount $973,000 $112,500 Next Year's Percentage Increase (Decrease) 4% 2% Next Year's Amount ($) EITI Beverage cost Labor (including benefits) Other operating costs Fixed costs 36% 23% $298,000 1% (1%) (2%) 16% same $70,000 same a. What is the current year's budgeted profit (loss)? b. Develop next year's budget indicate the profit (loss). R Problem

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